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GLOBAL MARKETS-World stocks shrug off slowing China trade to hit record high

Published 2017-08-08, 05:19 a/m
Updated 2017-08-08, 05:20 a/m
© Reuters.  GLOBAL MARKETS-World stocks shrug off slowing China trade to hit record high

* MSCI World index on track for best monthly run since 2003

* Miners weigh on European shares, higher oil aids energy firms

* Dollar dips vs major peers on doubts Fed will hike this year

* Graphic: World FX rates in 2017 http://tmsnrt.rs/2egbfVh

By Nigel Stephenson

LONDON, Aug 8 (Reuters) - Global stocks inched up to a new all-time high on Tuesday, shrugging off weaker-than-expected China's trade data that clouded an otherwise bright outlook for global growth.

Chinese imports and exports both fell well short of forecasts last month and growth in overall trade, while still a healthy 8.8 percent, was its slowest this year. MSCI's all-country world index .MIWD00000PUS ticked up to set a new record high at 480.76 points. It was last up less than 0.1 percent at 480.54 points.

The index, which tracks shares in 46 countries, is on track for longest monthly winning streak since 2003.

Shares across the globe have been hitting record highs in record low volatility supported by a benign environment for global growth.

Ratings agency Fitch this week lifted its outlook for the world economy for this year and next.

"Data continue to suggest a synchronised global expansion across both advanced and emerging market economies. Spill-overs from the rebound in emerging market demand are reflected in the fastest growth in world trade since 2010," said Fitch chief economist Brian Coulton.

European shares edged in and out of positive territory.

The pan-European STOXX 600 index .STOXX was last down 0.1 percent, led lower by miners.

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Energy company shares rose .SXEP as oil prices steadied from recent falls as sources told Reuters Saudi Arabia would cut crude supplies next month. O/R Reuters Live Markets blog on European and UK stock markets see reuters://realtime/verb=Open/url=http://emea1.apps.cp.extranet.thomsonreuters.biz/cms/?pageId=livemarkets

MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS proved relatively resilient, inching up 0.2 percent and back toward decade highs.

South Korea .KS11 dipped 0.2 percent, while Japan's Nikkei .N225 eased 0.3 percent and China's main markets .CSI300 .SSEC edged up 0.1 percent. Hong Kong's Hang Seng .HSI closed up 0.6 percent.

In currency markets, the dollar dipped for a second consecutive day after rising on Friday following stronger-than-expected U.S. jobs numbers, which some analysts said bolstered the case for the Federal Reserve to raise interest rates further. many in markets remain unpersuaded the Fed will increase the cost of borrowing again this year.

St Louis Fed President James Bullard said on Monday the central bank could leave rates where they are for now because inflation was not likely to rise much. seemed to oppose further rate hikes. That means they exactly reflect the current market expectations, which are limiting the dollar's appreciation," wrote analysts at Commerzbank (DE:CBKG) in Frankfurt in a morning note to clients.

"It is still inflation that poses the problem," they added.

The dollar index was down 0.2 percent .DXY . The euro gained 0.2 percent to $1.1811 EUR= while the yen rose a similar amount to 110.54 to the dollar JPY=

Sterling was up 0.1 percent at $1.3045 GBP=D3 .

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German 10-year government bond yields, the benchmark for borrowing costs in the euro zone, held close to their lowest in more than a month, supported by expectations that any withdrawal of European Central Bank stimulus will be gradual.

This view was boosted on Monday by data showing industrial output in the euro zone's biggest economy unexpectedly fell 1.1 percent in June from a month earlier. crude oil, the international benchmark, rose 16 cents to $52.53 a barrel LCOc1 . An industry source familiar with the matter told Reuters Saudi state oil company Aramco will cut allocations to its customers next month by at least 520,000 barrels a day. is coming from a stabilising U.S. rig count, falling U.S. inventories and the Saudi cut in exports," Ole Hansen, head of commodity strategy at Denmark's Saxo Bank, told the Reuters Global Oil Forum.

"But against this we still have robust production growth from the United States, Libya and Nigeria."

Gold XAU= rose 0.3 percent to $1,261 an ounce.

<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ World stocks head for longest monthly winning streak since 2003

http://reut.rs/2hFBoyN

^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^> (Additioonal reporting by Wayne Cole in Sydney, Jemima kelly, Abhinav Ramnarayan and Christopher Johnson in London; Editing by Alison Williams)

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