July 7, 2014 / 3:40 PM / 3 years ago

GLOBAL MARKETS-Stocks pull back from recent highs, dollar eases

* Global equity markets ease ahead of earnings season
    * Dollar trades flat versus euro, down versus yen
    * Crude oil trades lower

 (Adds opening of U.S. markets, byline, dateline; previous
LONDON)
    By Herbert Lash
    NEW YORK, July 7 (Reuters) - The dollar eased and global
equity markets fell on Monday as momentum from last week's
strong U.S. jobs data, which sent several stocks indices to
record highs, faded and investors turned to corporate earnings
for the second quarter.
    Weak manufacturing data from Germany took the wind out of
European shares and the euro, but those moves were mostly minor
and there was little sign of skittishness in the region's bond
markets.
    Wall Street pulled back the from record highs hit on
Thursday by the S&P 500 and Dow industrials, while MSCI's
all-country world index also slipped after hitting a record the
same day. U.S. markets were closed on Friday for the
Independence Day holiday.
    The blended earnings-per-share growth rate for the S&P 500
in the second quarter is 6.2 percent, according to Thomson
Reuters. Of the 22 companies in the S&P 500 that have reported
earnings so far, 63.6 percent beat analyst expectations, in line
with a typical quarter over the past 20 years.
    "This earnings season has a lot of pressure on it, since we
need to see significant revenue growth to offset weakness in the
first quarter," said Oliver Pursche, president of Gary Goldberg
Financial Services in Suffern, New York.
    MSCI's ACWI was down 0.28 percent, while the
pan-European FTSEurofirst 300 index of leading regional
shares was down 0.6 percent at 1,385.74.
    The Dow Jones industrial average fell 40.07 points,
or 0.23 percent, to 17,028.19. The S&P 500 lost 4.32
points, or 0.22 percent, to 1,981.12 and the Nasdaq Composite
 dropped 9.591 points, or 0.21 percent, to 4,476.334.
    The U.S dollar inched higher against the euro but pared some
early gains as investors speculated about when the Federal
Reserve is likely to begin raising rates after last week's
strong employment report.
    Goldman Sachs on Sunday pulled forward its forecast for the
first hike in the Federal Reserves' federal funds rate to the
third quarter of 2015 from the first quarter of 2016 because of
a stronger jobs market, rising inflation and accelerating U.S.
economy.
    The dollar has gained and the Treasuries yield curve has
flattened after data on Thursday showed nonfarm payrolls
increased by 288,000 jobs in June and the unemployment rate fell
to 6.1 percent from 6.3 percent in May. 
    The euro was last up 0.01 percent against the dollar 
at $1.3595. The dollar was down 0.24 percent versus the Japanese
yen at 101.86. 
    The 10-year U.S. Treasury note rose 7/32 in
price to yield 2.6229 percent.
    Oil prices fell. Brent was down 15 cents at $110.49
a barrel. U.S. oil fell 68 cents to $103.38 a barrel.

 (Additional reporting by Marc Jones; reporting by Herbert Lash;
Editing by Meredith Mazzilli)

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