* Gold hits three-week high as Ukraine tensions simmer
* Oil slips below $108 a barrel on Chinese factory data
* Yen at two-week high vs dollar on soft China data
(Adds close of European bond, stock markets)
By Herbert Lash
NEW YORK, May 5 Global equity markets were
steady on Monday as upbeat U.S. data offset a contraction in
Chinese manufacturing that renewed concerns about a slowing
economy in China, while escalating tensions over Ukraine
underpinned safe-haven gold.
Shares were little changed on Wall Street, following
declines across European equity markets, as Ukraine's interior
minister drafted a new special forces unit into Odessa and
fighting continued near the eastern town of Slaviansk.
The violence in Odessa, a southwestern port with a broad
ethnic mix from Russians and Ukrainians to Georgians and Tatars,
was seen as a turning point in Kiev, encroaching for the first
time into an area beyond the Russian-speaking east.
U.S. equities came off early lows after the Institute for
Supply Management said its services sector index rose to 55.2 in
April, the fastest pace in eight months, from 53.1 in March,
topping expectations for a read of 54.1.
The data provided further evidence that the U.S. economy is
emerging from a lackluster winter, a lull largely blamed on
"It's more confirmation the economy is strengthening and we
are headed for stronger growth," said Peter Cardillo, chief
market economist at Rockwell Global Capital in New York.
"Unfortunately, we had those headlines out of Ukraine where
the situation seems to be escalating, but once the market
realized the economy is doing better we saw the snapback."
MSCI's all-country world stock index pared
losses to trade down 0.05 percent, while the euro zone's
blue-chip Euro STOXX 50 index also pared losses to
close 0.21 percent lower at 3,171.29.
Markets in London were closed for a public holiday.
On Wall Street, the Dow Jones industrial average fell
2.18 points, or 0.01 percent, to 16,510.71. The S&P 500
gained 0.66 point, or 0.04 percent, to 1,881.8, and the Nasdaq
Composite added 3.007 points, or 0.07 percent, to
Pfizer Inc, the biggest U.S. drugmaker, pulled the
Dow Industrials lower after it reported revenue well below
analysts' expectations. Shares fell 2.4 percent to $30.01.
Gold prices hit three-week highs in thin trade, extending
the previous session's gains, fueled by the simmering tensions
U.S. gold futures for June delivery were up $7.10 an
ounce at $1,310.00.
The data on China's manufacturing sector also weighed on
crude oil prices. A private survey on Monday showed that the
Chinese manufacturing sector contracted for a fourth consecutive
month in April.
HSBC/Markit purchasing managers' index for April came in at
48.1, lower than a preliminary reading of 48.3, but up slightly
from an eight-month low of 48.0 in March. A reading below 50
Oil slipped below $108 a barrel.
Brent crude for June delivery fell $1.32 to $107.27
a barrel. U.S. crude was down 59 cents at $99.17 a
The safe-haven yen rose to a two-week high against the
dollar on the Chinese data.
The greenback fell as low as 101.84 yen, its weakest
level since April 17 and down more than 1 yen from Friday's near
one-month high of 103.025 yen on trading platform EBS. It was
last trading at 102.07, down 0.11 percent on the day.
The dollar index was down 0.07 percent, while the
euro was 0.09 percent higher against the dollar at
U.S. Treasuries eased, giving up early gains
U.S. government bond prices fell, with the 10-year note
down 4/32 to yield 2.6077 percent.
(Reporting by Herbert Lash; Additional reporting by Catherine
Evans in London; Editing by James Dalgleish and Leslie Adler)