(Adds North American trading, quotes and changes byline and
dateline; previous LONDON)
* European, U.S. equities shrug off China's falling stocks
* U.S. Federal Reserve in focus
* Brent oil hits 6-month low
By Michael Connor
NEW YORK, July 28 (Reuters) - U.S. and European stocks were
on track to snap five-day losing streaks on Tuesday, as
investors focused on earnings news and mergers and looked past
another fall in Chinese equities and sliding oil prices.
Safe-haven government bonds eased in price, while the dollar
rallied on growing expectations the Federal Reserve could take a
hawkish bias toward raising interest rates in a policy statement
due on Wednesday.
Wall Street's Dow Jones industrial average .DJI rose 37.21
points, or 0.21 percent, to 17,477.8 in early trade, the S&P 500
.SPX was up 5.8 points, or 0.28 percent, to 2,073.44 and the
Nasdaq Composite .IXIC added 1.78 points, or 0.04 percent, to
5,041.56.
United Parcel Service (NYSE:UPS) UPS.N shares jumped more than 3.5
percent and Ford F.N gained 1.5 percent after each reported
better-than-forecast profits.
Merger news helped lift European stocks, with the
FTSEuroFirst 300 index of leading European shares up 0.90
percent at 1,543 points .FTEU3 .
RSA Insurance Group RSA.L jumped 11 percent after Zurich
Insurance ZURN.VX said it was considering a bid for the
British group, which has a market capitalization of 4.4 billion
pounds ($6.9 billion).
Shares in Kering PRTP.PA meanwhile surged 6.6 percent
after Gucci, the flagship brand of the French luxury and
sportswear group, posted a 4.6 percent rise in underlying
second-quarter sales.
"For me, China is a short blip rather than a real slowdown.
What we are hearing from company management is pretty buoyant,"
said Ingo Speich, portfolio manager at Union Investment in
Frankfurt.
The main China indexes fell again, although by nowhere near
as much as Monday's 8.5 percent plunge. The Shanghai market
benchmark .SSEC closed 1.7 percent lower.
The Fed kicked off a two-day policy meeting on Tuesday. No
immediate change in interest rates is expected, so attention
will focus on whether Fed Chair Janet Yellen signals September
or December as the most likely date for a rate increase.
Oil remained under pressure. Brent crude futures hit a new
six-month low after Monday's Chinese stock market crash stoked
worries the world's biggest energy consumer may cut back demand,
adding to a global supply glut. O/R
Brent fell as much as 2 percent to $52.28 LCOc1 , a level
not seen since Feb. 2. U.S. crude CLc1 was down 0.35 percent
to $47.27 a barrel after touching its lowest since late March.
The price of copper CMCU3 , heavily influenced by demand
from key consumer China, recovered from Monday's six-year low
and was up 1 percent at $5,245 a tonne on the London Metal
Exchange.
In currency markets, the dollar rose against many of its key
rivals, including the euro and yen, as traders bet that the
first U.S. rate hike in almost a decade is still likely to come
in September.
The euro fell 0.5 percent at $1.1035 EUR= , almost a full
cent down from Monday's two-week high of $1.1129, and the dollar
was up 0.35 percent against the yen at 123.66 yen JPY= .
Bond yields edged higher, with the 10-year U.S. Treasuries
off 8/32 in price and yielding 2.2571 percent US10YT=RR . The
comparable UK yield rose 3 basis points, while the yield on the
10-year German Bund was up 2 basis points.
(Additional Reporting by Jamie McGeever; and Lionel Laurent;
Editing by Larry King and Meredith Mazzilli)