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REFILE-GLOBAL MARKETS-Stocks lose steam at end of solid month; sterling falls

Published 01/06/2017, 05:29 am
Updated 01/06/2017, 05:30 am
© Reuters.  REFILE-GLOBAL MARKETS-Stocks lose steam at end of solid month; sterling falls
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(Refiles to say "note" instead of "not" in first paragraph)

* MSCI global stock index rises for seven consecutive months

* Safe-haven bids support gold, bonds at month-end

* Oil prices hit 3-week lows on anxiety about supply glut

* Chinese yuan jumps to highest in over six months

By Richard Leong

NEW YORK, May 31 (Reuters) - Major stock markets around the globe ended a solid May on a weak note on Wednesday, while the sterling fell as conflicting poll results stoked worries whether the ruling Conservatives could lose seats in next week's UK general election.

MSCI's global equity index .MIWD00000PUS , which tracks 45 stock markets, dipped 0.1 percent on Wednesday, paring its month-to-date gain to 1.8 percent. The index booked seven months of increases, which would be its longest monthly winning streak in over a decade.

The diminished appeal of stocks on Wednesday underpinned safe-haven bids for gold and low-risk U.S. and German government bonds.

Oil prices declined to a three-week low as news of a rebound in Libyan production exacerbated worries about a global oversupply despite OPEC's pact to extend output cuts last week. Wednesday's losses, hopes for an economic pickup in Europe, together with signs of stability in Japan and China and moderate U.S. growth, supported expectations for steady gains in stocks, corporate bonds and other risky assets in the near term, analysts said.

"You have some cyclical recovery in some of the major countries in Europe," said Robert Tipp, chief market strategist at PGIM Fixed Income in Newark, New Jersey. "This should be a favorable environment for risky assets."

In late afternoon trading, the Dow Jones Industrial Average .DJI fell 41.27 points, or 0.2 percent, to 20,988.2, the S&P 500 .SPX lost 4.78 points, or 0.20 percent, to 2,408.13 and the Nasdaq Composite .IXIC dropped 19.73 points, or 0.32 percent, to 6,183.46. broad FTSEurofirst 300 index .FTEU3 ended 0.1 percent lower, at 1,532.14. It gained 0.8 percent in May. sharp fall in euro zone inflation led investors to believe the European Central Bank will not be quite as hawkish at its policy meeting next week as had originally been expected. 10-year Treasury note yields US10YT=RR were down 2 basis point at 2.198 percent, a near two-week low, while 10-year German Bund yields DE10YT=RR hit 0.286 percent, the lowest in over five weeks. biggest mover in currencies was sterling, which shed as much as 0.5 percent after a YouGov poll showed the ruling Conservative Party might lose 20 of the 330 seats it holds, while the opposition Labor Party could gain nearly 30 seats, in a national election next week. fell to a six-week low of $1.2770 GBP=D4 before recovering some ground to $1.2887. It also slipped to 0.8722 pound per euro EURGBP=D4 , not far from Friday's eight-week low of 0.8750. dollar fell 0.4 percent against a basket of currencies .DXY following weaker-than-forecast data on U.S. pending home sales. the yuan CNY=CFXS jumped to its strongest in more than 6 months on bets the Chinese central bank is now less inclined to allow the currency to weaken markedly against the greenback. commodities, Brent crude LCOc1 settled $1.53, or 2.95 percent, lower at $50.31 a barrel. U.S. crude CLc1 settled down $1.34 or 2.70 percent at $48.32 per barrel. gold prices XAU= rose $9.09 or 0.72 percent, to $1,271.80 an ounce. They touched a one-month high of $1,270.47 on Tuesday. Global assets in 2017

http://reut.rs/1WAiOSC Global bonds dashboard

http://tmsnrt.rs/2fPTds0 World FX rates in 2017

http://tmsnrt.rs/2egbfVh 2017 asset returns

http://tmsnrt.rs/2jvdmXl

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