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GLOBAL MARKETS-Shares snap losing streak as oil ends its decline

Published 2016-09-01, 05:36 a/m
© Reuters. GLOBAL MARKETS-Shares snap losing streak as oil ends its decline
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* European shares rise, world stocks snap six days of falls

* Crude oil prices take back some ground lost on oversupply fears

* China official PMI edges up, but private survey slips

* Pound gains after from rebound in UK manufacturing PMI

By Marc Jones

LONDON, Sept 1 (Reuters) - Gains in Europe helped pull world shares out their longest losing streak of the year on Thursday, as oil prices ticked up before key U.S. jobs data.

Markets were juggling a host of issues, including lacklustre data from Asia's two biggest economies, the ousting of Brazil's president and signs that Spain's political impasse would continue. Nevertheless, risk appetite was slowly re-emerging.

Europe's main stock markets .FTEU3 gained 0.4 to 0.7 percent to help MSCI's All World index .MIWD00000PUS end six days of losses, its longest since the start of January.

Commodity companies were among the leaders as oil took back some of the 8 percent it had lost this week, a decline that accelerated on Wednesday after data showed U.S. crude and distillate stockpiles increased more than expected. O/R

Brent crude futures LCOc1 rose to $47.08 per barrel, after falling almost 3 percent overnight. U.S. crude CLc1 gained 0.5 percent to $44.92 after shedding 3.6 percent on Wednesday. Its gain for August was 7 percent.

After the disappointing data from Asia, European surveys showed euro zone manufacturing growth slowed, although Britain staged one of its sharpest rebounds on record as factories recovered from June's vote to leave the European Union.

The pound rose more than a cent to $1.3250, which put it on course for its best day in two weeks. GBP/

"(British) companies reported that work that had been postponed during July had now been restarted, as manufacturers and their clients started to regain a sense of returning to business as usual," Markit economist Rob Dobson said.

The British data also helped to nudge European bond yields higher. Spanish government bond yields touched a three-week high of 1.026 percent after acting Prime Minister Mariano Rajoy lost a vote of confidence in parliament, raising the prospect of a third election in a year ON JOBS

Friday's U.S. nonfarm payrolls report remains this week's market focus, after Federal Reserve Vice Chair Stanley Fischer said last week the jobs data will be a factor in the timing of central bank interest rate hikes.

Employers are expected to have added 180,000 jobs in August, according to the median estimate of 89 economists polled by Reuters ECONUS .

The ADP National Employment Report on Wednesday showed U.S. private employers adding 177,000 jobs in August, above the 175,000 forecast by a Reuters survey of economists, and contracts to buy previously owned homes surged in July dollar's gains were tempered after the Institute for Supply Management-Chicago said its business barometer dropped 4.3 points to 51.5 in August, short of expectations.

Spot gold XAU= slipped 0.1 percent to $1,307.80 an ounce, moving back towards its overnight low of $1,304.91, which was its lowest level since June 24 GOL/ .

In Asia overnight, MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS ended down 0.2 percent, while Australia's S&P/ASX 200 index .AXJO shed 0.3 percent.

One of the drags was private-sector data showing that Chinese manufacturing activity stagnated in August. Growth in output and new orders slowed and companies shed staff for the 34th month in a row Japan, manufacturing activity showed signs of steadying, but the HIS Markit/Nikkei PMI remained below the 50 mark that separates expansion from contraction, edging up to 49.5 in August from 49.3 in July.

Output grew for the first time in six months, but export orders fell again, bolstering expectations the Bank of Japan will need to offer more stimulus to revive the sputtering economy.

Japan's Nikkei stock index .N225 ended up 0.2 percent.

The dollar was up 0.1 percent at 103.51 yen JPY= , not far from Wednesday's 103.54, its highest in more than month. The euro slipped to $1.1148 EUR= .

"There are still some sceptics who are still not convinced that the Fed will take action (on rates) again this year," said Antje Praefcke, currency strategist at Commerzbank (DE:CBKG).

"They have been misled by the Fed one too many times over the past few months in their hope for a rapid rate hike cycle following the lift-off."

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