(Adds New York trading, changes byline and dateline; previous
LONDON)
* Shanghai market records biggest daily loss since 2007
* Dollar falls more than 1 percent against euro
* Fed meets on Tuesday and Wednesday
By Michael Connor
NEW YORK, July 27 (Reuters) - The biggest rout in Chinese
shares in eight years stoked concerns on Monday over the
worldwide impact of slowing growth in the world's No. 2 economy,
knocking down global equities and the prices of key commodities.
The dollar was weak ahead of the week's main set piece -
Wednesday's Federal Reserve policy decision and statement - with
a better-than-expected survey of German business sentiment
prodding the euro above $1.11 for the first time in two weeks.
Wall Street opened lower on worries over China's slowing
growth, crystallized by a stunning 8.5 percent fall in Shanghai
that also rattled equity markets in Europe and Asia.
ID:nL3N1074UA
By mid-morning the Dow Jones industrial average .DJI was
off 111.04 points, or 0.63 percent, to 17,457.49, the S&P 500
.SPX was down 8.94 points, or 0.43 percent, to 2,070.71, and
the Nasdaq Composite .IXIC had lost 31.43 points, or 0.62
percent, to 5,057.21. ID:nL3N1074UA
Share indices in Frankfurt and Paris tumbled more than 2
percent .GDAXI .FCHI , while London's FTSE 100 was off nearly
1 percent .FTSE . Japan's Nikkei .N225 slipped nearly 1
percent, while MSCI's broadest index of Asia-Pacific shares
outside Japan .MIAPJ0000PUS fell 1.7 percent.
Traders and investors said the declines largely came on
concerns over sluggish global economic growth triggered by the
Chinese equity slump and weak recent data, which overshadowed
some forecast-beating corporate results.
Both copper, for which Chinese demand is an important
driver, and the broader Thomson Reuters CRB commodities index
.TRJCRB hit their lowest point in six years. Copper futures
CMCU3 fell another 1 percent on Monday.
Oil was near four-month lows after the Chinese stock market
crash fueled worries over the economic health of the world's
biggest energy consumer and as more evidence emerged of a global
supply glut.
Brent crude LCOc1 fell $1.07 cents to $53.56 a barrel,
touching its lowest in almost four months, adding to falls which
are expected to put more downward pressure on global inflation.
"The drop in Chinese equities and the negative growth
backdrop in China are clearly going to leave you very concerned
about Chinese demand," said Nic Brown, head of commodities
research at Natixis.
Despite the still patchy economic news, many analysts still
expect U.S. central bank policymakers meeting this week to raise
interest rates in September. Federal Reserve chief Janet Yellen
drove the dollar higher earlier this month by saying a rate hike
this year was on the cards, but she has gone no further than
that.
Expectations of a hike have slowly pushed up U.S. Treasury
yields and widened the dollar's premium over the euro. But the
euro has also tended to rise when investors get more concerned
about global growth and rein in riskier bets, as they were doing
on Monday.
The common currency gave back some of its early gains from a
bullish Ifo survey of German business sentiment ECONDE to
stand up 1 percent on the day at $1.1094 EUR= . A dollar index
was down 0.80 percent.
U.S. Treasury prices were up, getting a lift from
international investors seeking shelter from tumbling stock
prices. The bellwether 10-year note US10YT= was last up 14/32
and yielding 2.2247 percent.