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UPDATE 1-DoubleLine's Gundlach predicts S&P will post negative return in 2018

(Adds Gundlach quotes)

NEW YORK, Jan 9 (Reuters) - While U.S. stocks are now in an "accelerating phase," billionaire investor Jeffrey Gundlach is predicting that the S&P 500 will post a negative rate of return in 2018.

One of the best investments for 2018 will be commodities, Gundlach, chief executive of DoubleLine Capital and known on Wall Street as the "Bond King," said on an investor webcast on Tuesday.

Gundlach said if the 10-year U.S. Treasury note yield goes above 2.63 percent, U.S. stocks will be affected. "If the 10-year goes above 2.63 ... it will accelerate higher and equity markets are going to be spooked and maybe that's the cocktail that is coming our way."

Gundlach, who manages $119 billion at Los Angeles-based DoubleLine, said investors are "celebrating the magic moment of stronger economic growth domestically, stronger economic growth globally, stronger earnings." He said overall he is seeing "a lot of euphoria out there, a lot of bullishness" on the equity markets.

Gundlach said the financial markets have not priced in a "more hawkish" European Central Bank. "Maybe that's why the euro has started to rally," he said, adding: "Maybe it will rally further." (Reporting by Jennifer Ablan; Editing by Lisa Shumaker and James Dalgleish)