(Corrects analyst's affiliation in paragraph 4 and description
of the dollar's activity on Thursday morning in paragraph 5)
* Global share indexes near all-time high
* S&P 500 hits record on growth bets despite U.S. GDP
* U.S. bond yields slip to 11-month lows
By Angela Moon
NEW YORK, May 29 Global equity markets hovered
just off all-time highs on Thursday as investors brushed off a
weaker-than-expected reading on the U.S. economy, while
benchmark U.S. Treasury yields fell to 11-month lows.
On Wall Street, the S&P 500 hit another intraday high early
in the session despite first-quarter GDP data showing the U.S.
economy contracted 1 percent. Better-than-expected jobless
claims pointing to a strengthening labor market and merger and
acquisition activity also boosted sentiment.
The dollar trimmed early losses against major currencies as
traders focused on signs of the U.S. economy strengthening.
"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 dollar retraced earlier losses against the euro and
British pound following the GDP report.
The MSCI World Index, which has gained 1.4
percent since the last ECB policy meeting, was up 0.9 percent.
Wall Street's Dow Jones industrial average was up
9.77 points, or 0.06 percent, at 16,642.95. The Standard &
Poor's 500 Index was up 3.39 points, or 0.18 percent, at
1,913.17. The Nasdaq Composite Index was up 11.92
points, or 0.28 percent, at 4,236.99.
European shares held near multi-year highs, with the
pan-European FTSEurofirst 300 index close to a near
six-year peak reached earlier this week.
The euro, which had fallen around 2 percent against
the dollar over the same period, consolidated just above a
three-month low of $1.3584.
Yields on benchmark 10-year Treasuries last
traded at 2.409 percent. The yield on 30-year bonds
was 3.273 percent, an 11-1/2-month trough.
While U.S. yields have fallen on economic worries and some
safe-haven demand tied to conflict in Ukraine, analysts
attribute the move to technical factors, including month-end
portfolio rebalancing and exiting bets on rising yields.
German bond yields held at the lowest levels
in a year and on course to record a fifth consecutive month of
declines on bets the European Central Bank would unveil new
stimulus measures next week.
ECB policymakers have opened the door to a rate cut,
effectively charging banks to hold cash at the central bank
overnight, and to a refinancing operation aimed at supporting
businesses when its board meets on June 5.
Gold extended losses to a third straight session, hitting
16-week lows as the dollar hovered near a two-month high, while
weak physical demand in top buyer China also weighed.
Spot gold fell to $1,251.50 an ounce - its lowest
since Feb. 4 - in early trade and was down 0.4 percent at
$1,253.33. It dropped nearly 3 percent over the past two
Oil rose on signs of stronger demand from top oil consumer
the United States. Brent was up 55 cents at $110.36 a
barrel after losing 21 cents on Wednesday. U.S. crude oil
gained 51 cents to $103.23.
(Reporting by Angela Moon; Editing by Dan Grebler)