(Corrects analyst's affiliation in paragraph 5, updates
paragraph 7 to show final figures for the U.S. stock indexes)
* U.S. first-quarter GDP revised to show contraction but
* S&P ends at third record high in four sessions despite
* U.S. bond yields rebound from 11-month lows
By Angela Moon
NEW YORK, May 29 Global equity markets hit an
all-time high on Thursday, boosted by the U.S. S&P 500 which
scored its third record closing high in four sessions as
investors shrugged off data that showed the U.S. economy
contracted in the first quarter.
U.S. benchmark Treasury yields, which fell to 11-month lows
earlier, erased losses while the dollar finished down against
other major currencies.
On Wall Street, a flurry of merger and acquisition activity
in food and technology sectors as well as bets on improvement in
the second quarter boosted investors' appetite for risky assets,
sending the S&P 500 to yet another record high.
Data showed the downgrade in business activity that resulted
in first-quarter gross domestic product falling 1 percent
stemmed largely from a drop in inventories. While this was
steeper than forecast, it was not severe enough to change the
outlook for a sizable recovery in the second quarter.
"Once you get beyond the headline number and look under the
hood, things don't really look so bad," said Boris Schlossberg,
managing director of FX strategy at BK Asset Management in New
York. "Inventories were to blame for a lot of it and that bodes
well for the future."
The MSCI World Index, up 1.4 percent since
the last ECB policy meeting, gained 0.4 percent to a new record
Wall Street's Dow Jones industrial average rose 65.56
points or 0.39 percent, to end at 16,698.74. The S&P 500
gained 10.25 points or 0.54 percent, to finish at 1,920.03. The
Nasdaq Composite added 22.87 points or 0.54 percent, to
close at 4,247.95.
European shares held near multi-year highs, with the
pan-European FTSEurofirst 300 index closing up 0.1
percent at 1,379.05, within a whisker of a near six-year high of
1,380.52 reached this week.
The U.S. dollar index, composed of six currency
pairs, was off 0.08 percent after being down 0.17 percent ahead
of the GDP report, which was issued simultaneously with Labor
Department data showing fewer claims for unemployment benefits.
The yield on the 30-year bond was 3.328 percent
after earlier hitting 3.278 percent, an 11-1/2-month low.
Gold prices eased but bounced off their lowest level in
nearly four months. Spot gold was down 0.2 percent to
$1,255.29 after falling as low as $1,251.10 an ounce, its lowest
since Feb. 4.
Oil rose on signs of stronger demand from top oil consumer
the United States. U.S. crude oil settled 86 cents higher
at $103.58 a barrel and Brent crude settled 16 cents
higher at $109.97 a barrel.
(Reporting by Angela Moon; Editing by Dan Grebler and Chizu