* China GDP grows 6.4%, industrial output surges in March
* World stocks pare gains as Wall St dips on healthcare weakness
* NZ dollar dives on soft inflation data
* World FX rates in 2019: http://tmsnrt.rs/2egbfVh (Updates to open of U.S. markets, changes byline, dateline; previous LONDON)
By April Joyner
NEW YORK, April 17 (Reuters) - World stock markets pared earlier gains as a continued flight from healthcare shares dragged on Wall Street, overshadowing earlier upbeat economic data from China.
The S&P 500 .SPX flattened as the healthcare index .SPXHC dived 2.1% on continued fallout from concerns about potential changes to U.S. policy. corporate results, including an earnings beat from Morgan Stanley (NYSE:MS) MS.N and a revenue miss from International Business Machines (NYSE:IBM) Corp IBM .N , also dampened conviction among investors, said Chad Morganlander, senior portfolio manager at Washington Crossing Advisors in Florham Park, New Jersey.
"There's no great narrative today," he said. "Everyone's waiting for incoming data from earnings before they make additional moves."
MSCI's 47-country world index .MIWD00000PUS barely remained in positive territory, having earlier been buoyed by better-than-expected Chinese data showing the country's economy grew 6.4% in the first quarter. industrial output surged 8.5 percent in March from a year earlier, the fastest pace since July 2014 and well above forecasts of a 5.9 percent increase. Retail sales also pleased, with a rise of 8.7 percent. Global Investors strategist and portfolio manager Neil Dwane said the data had been good enough to allay fears that China's economy was collapsing although the rest of the year remained in question.
"Beijing will now be in a wait and see mode to gauge whether it has done enough," Dwane said, referring to stimulus efforts. "To be bullish (on stocks) from here you would have to believe in a pretty strong global recovery in the second half... We are a bit more ho-hum."
The Dow Jones Industrial Average .DJI fell 2.96 points, or 0.01%, to 26,449.7, the S&P 500 .SPX lost 1.96 points, or 0.07%, to 2,905.1 and the Nasdaq Composite .IXIC added 4.41 points, or 0.06%, to 8,004.63.
The pan-European STOXX 600 index .STOXX rose 0.10%.
MSCI's gauge of stocks across the globe .MIWD00000PUS gained 0.02%.
Benchmark 10-year notes US10YT=RR last rose 2/32 in price to yield 2.5868%, from 2.594% late on Tuesday. positive China data earlier pushed up the Australian dollar AUD= , often a liquid proxy for China plays, as much as 0.4% against the dollar to a two-month high. The Australian dollar later pared those gains to trade little changed.
Against a basket of major currencies, the dollar .DXY weakened 0.1% to 96.96 but remained within the 95.00 to 97.70 range that has held for the past six months.
The euro EUR= edged up 0.2% to $1.1302, recovering from losses driven by a Reuters report that several European Central Bank policymakers think the bank's economic projections are too optimistic. currency on the move was the New Zealand dollar NZD= which sank 0.7% to $0.6716 after annual consumer price inflation came in well below expectations, at just 1.5 percent for the first quarter. L3N21Y4Y3
In commodity markets, the general improvement in risk sentiment saw spot gold slip XAU= to its lowest for the year so far. It was last down 0.1% at $1,274.4247 per ounce.
Oil prices edged lower, reversing course from earlier gains on Chinese economic data and a fall in U.S. crude stocks. crude LCOc1 futures fell 5 cents to $71.67 a barrel, a 0.1% loss. U.S. West Texas Intermediate (WTI) crude CLc1 futures fell 10 cents to $63.95 a barrel, a 0.2% loss.
<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ Asia stock markets
https://tmsnrt.rs/2zpUAr4 Asia-Pacific valuations
https://tmsnrt.rs/2Dr2BQA World FX rates in 2019
http://tmsnrt.rs/2egbfVh World stocks bounce $7.5 trillion since late December
https://tmsnrt.rs/2IoRV6P
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