* U.S. equities end down but off deepest losses
* S&P 500 has biggest weekly drop in more than two years
* Worries about quicker Fed interest rate hike diminish
* U.S. Treasuries yields drop, gold bounces back
(Adds New York closing prices, weekly metrics, quotes)
By Michael Connor
NEW YORK, Aug 1 Global equities markets dropped
for a fourth day on Friday, with Wall Street again slumping as
investors shrugged off economic data showing solid improvement
in U.S. labor markets.
U.S. Treasury debt prices rose, while the dollar moved
U.S. stock trading was dogged by worries about Argentina's
debt problems. A U.S. judge criticized Argentina's decision to
default earlier this week and ordered talks between the country
and holdout investors to continue..
Confusion over Federal Reserve policy and ongoing tensions
in Ukraine and Gaza were also blamed for the U.S. stocks drop.
Stock indices in New York had lost 2 percent on Thursday and
posted sharp losses again on Friday before trimming them
somewhat in late trading.
The Dow Jones industrial average fell 69.93 points or
0.42 percent, to 16,493.37, the S&P 500 lost 5.52 points
or 0.29 percent, to 1,925.15 and the Nasdaq Composite
dropped 17.13 points or 0.39 percent, to 4,352.64.
For the week, the Dow was down 2.8 percent and the Nasdaq
was down 2.2 percent. The S&P lost 2.7 percent, its biggest
weekly decline since the week ending June 1, 2012.
Wall Street's losses may not be finished, according to Nick
Sargen, chief economist at Fort Washington Investment Advisors
"We're still not cheap by any means, and this could be the
start of the 10 percent correction that's been long overdue," he
Friday's U.S. downturn extended a global decline, which
began on Thursday with Wall Street's sell-off. The MSCI
All-Country World index, which has been off
nearly all week, was down 0.55 percent at 420.70 late on Friday.
Japan's Nikkei index dropped to a one-week low and
European shares were off 1.23 percent.
U.S. Treasury yields eased on publication of July's U.S.
employment data, which included a sixth straight month of over
200,000 job additions in the world's biggest economy and soft
hourly wage increases.
Benchmark 10-year notes were last up 15/32 in
price to yield 2.51 percent, down from 2.58 percent before the
jobs data was released.
"It's a Goldilocks report for an economy that is steadily
expanding but not lifting off. It will reinforce for now the
Federal Reserve's commitment to a gradualist policy approach,"
said Mohamed El-Erian, chief economic adviser at Allianz in
Newport Beach, California.
The dollar, which has been climbing on hopes U.S. rates
would rise sooner rather than later, moved lower. Analysts noted
the jobs data showed no uptick in hourly wages, an indicator
said to be of central importance to Fed Chair Janet Yellen.
The U.S dollar index, which measures the greenback
versus six major currencies, had traded near 10-month highs but
was down 0.17 percent at 81.32.
"The dollar may have become a bit overly stretched," said
Joe Manimbo, senior market analyst at Western Union Business
Solutions in Washington. "We are going to have to see some wage
growth to help justify these elevated levels for the greenback."
Gold rose nearly 1 percent, snapping a four-day losing
streak, as the payrolls data dampened talk of early rate rises
and polished bullion's appeal as a hedge. Spot gold prices
finished up 0.9 percent at $1.293.01 an ounce.
Brent crude oil fell more than $1 to hit a two-week low,
slipping below $105 a barrel in its third straight day of losses
as oversupply in the Atlantic basin and low demand outweighed
worries over political tensions in the Middle East, North Africa
and Ukraine. Brent crude traded at a low of $104.41.
U.S. crude futures fell 64 cents to $97.54 a barrel.
(Reporting by Michael Connor in New York; Additional Reporting
by Ryan Vlastelica in New York, Blaise Robinson in Paris, and
Sudip Kar-Gupta in London; Editing by Dan Grebler)