* Oil bounces back on pickup in gasoline demand
* Safe-haven yen, government debt up
* Global gauge of stocks drops, but off its lows
(Updates prices)
By Rodrigo Campos
NEW YORK, Feb 24 (Reuters) - Stocks across the globe fell on
Wednesday on concerns over economic growth but were off their
session lows after crude oil futures turned higher following
U.S. data.
The first contraction in the U.S. services sector since
October 2013 weighed on financial stocks but energy shares cut
losses as Brent gained nearly 3 percent.
Oil prices rose after strong U.S. gasoline demand offset
worries over record high crude stockpiles in the world's largest
economy.
"For the near-term, volatility stays and will hinge on what
happens in the crude market," said Ernie Cecilia, chief
investment officer of Bryn Mawr Trust in Devon, Pennsylvania.
The Dow Jones industrial average .DJI fell 135.7 points,
or 0.83 percent, to 16,296.08, the S&P 500 .SPX lost 15
points, or 0.78 percent, to 1,906.27 and the Nasdaq Composite
.IXIC dropped 28.39 points, or 0.63 percent, to 4,475.19.
The pan-European FTSEurofirst 300 share index .FTEU3 fell
2.3 percent and MSCI's gauge of stocks globally .MIWD00000PUS
fell 1.1 percent.
OIL REBOUNDS
Government data showed U.S. crude oil stockpiles rose by 3.5
million barrels in the United States last week to an all-time
peak above 507 million barrels. But gasoline demand over the
past four weeks rose more than 5 percent compared to a year ago
and inventories of the fuel also fell from lower refinery runs.
Brent crude LCOc1 , the global benchmark, rose 3 percent to
$34.26 a barrel. U.S. crude CLc1 added 0.2 percent to $31.95.
The reversal in oil and smaller decline in stocks pushed
yields on the lowest-risk government bonds slightly higher,
though they were still lower on the day.
Benchmark 10-year U.S. notes US10YT=RR were last up 14/32
in price to yield 1.6985 percent, down from 1.745 percent late
Tuesday. At their session low the yield was 1.647
percent.
In currency markets, the yen, often sought by investors as a
shelter when riskier assets are under pressure, hit an almost
three-year high against the euro EURJPY= of 122.43 yen. At
111.42, it rose 0.7 percent versus the U.S. dollar JPY= .
The euro EUR= was little changed versus the greenback at
$1.1016. The dollar index .DXY slipped 0.1 percent.
Sterling plumbed a seven-year low around $1.3876 on concern
Britons might vote to leave the European Union in a June
referendum. It last traded down 0.6 percent at $1.3933 GBP .
Copper CMCU3 rose 0.3 percent at $4,661 a tonne.
Gold XAU= jumped 1.3 percent, having risen as much as 2.1
percent.