GLOBAL MARKETS-Global equities, dollar edge up on U.S. business uptick

(Adds U.S. markets opening, U.S. economic data; Changes
dateline, previous LONDON)
* U.S. business activity surges to early 2019 levels
* U.S. home sales rise at record pace for second month
* Euro suffers, dollar gains after disappointing European
data
* German, French, eurozone PMIs below expectations

By Alwyn Scott
NEW YORK, Aug 21 (Reuters) - Upbeat readings on U.S.
business activity and home sales help push global equities and
the dollar higher on Friday, counteracting earlier stock
declines in Europe. The dollar's gain put it on track to break
an eight-week losing streak.
Even as new COVID-19 cases remain stubbornly high across the
United States, data firm IHS Markit's purchasing managers'
survey showed U.S. business activity in August snapped back to
the highest since early 2019 on Friday.
The flash U.S. Composite PMI Index rose to a reading of 54.7
this month - the highest since February 2019 - from 50.3 in
July. Its flash - or preliminary - indicator for the
manufacturing sector stood at its highest since January 2019 and
for the services sector it was the highest since March 2019.
Readings of more than 50 indicate growth in private
sector output.
Stronger-than-expected U.S. home sales, which rose at a
record pace for the second straight month, also pointed to a
growing economy. On Wall Street, the Dow Jones Industrial Average .DJI rose
0.26%, the S&P 500 .SPX gained 0.09% and the Nasdaq Composite
.IXIC added 0.29%.
Among global shares, MSCI's benchmark for global equity
markets .MIWD00000PUS was off its lows for the day, down 0.41%
to 569.62, while its index for emerging markets stocks .MSCIEF
fell 1.72%.
Europe's broad FTSEurofirst 300 index .FTEU3 dropped 0.29%
to 1,415.22.
A steep rise in jobless claims on Thursday and Federal
Reserve minutes on Wednesday suggested the economy was beginning
to stall a little bit, said Michael Arone, chief investment
strategist at State Street Global Advisors in Boston.
Those "were a little disappointing," Arone said. With
elevated risks, investors are seeking safe-havens.
"Investors are exiting some of the more economically
sensitive sectors of the market and going back to the old
stalwarts of tech, where you get reliable growth," Arone said.
Treasuries Benchmark 10-year notes US10YT=RR last rose
1/32 in price to yield 0.6428%, from 0.644% late on Thursday.
The 30-year bond US30YT=RR last rose 9/32 in price to
yield 1.3661%, from 1.377%.
Sombre economic numbers earlier in the day in Europe,
including euro zone data pointing to a faltering recovery,
doused stock market gains in Asia overnight, and also caused the
euro to recoil further from recent peaks.
The loss of momentum came after fresh numbers painting a
muted economic outlook, with purchasing managers' index releases
from France and Germany as well as the wider euro zone falling
short of expectations, flagging slowing momentum in the
recovery. "The eurozone flash PMIs for August paint a rather muted
picture for the single currency area's nascent economic
recovery," said Moritz Degler, senior economist at Oxford
Economics.
"The survey contains some strong evidence that the recovery
has slowed in August, particularly in the services sector,"
Degler added.
Analysts pointed to rising infection numbers having tempered
economic activity. On Thursday, France saw a post-lockdown
record in new infections, while countries across the region
imposed fresh travel restrictions.
News that Pfizer PFE.N reported positive early data from a
potential COVID-19 vaccine and could be on track to seek
regulatory review by October did little to brighten the mood.
European bourses had started the day on a brighter note,
following gains in Asia after U.S. tech shares closed higher on
Thursday. The S&P 500 has rallied 54% from its March low in a
world awash with monetary and fiscal stimulus, but money
managers are questioning the future trajectory.
"We think equity markets, certain credit markets, and the
U.S. dollar have yet to fully reflect the long-term impact of
ultra-loose Fed policy," said Mark Haefele, chief investment
officer at UBS Global Wealth Management.
In currency markets, the dollar index .DXY jumped 0.68%,
on track to end what would have been a ninth consecutive weekly
decline. Meanwhile the euro extended losses to drop as much as
0.7% to $1.1776 EUR=EBS , its lowest level in nearly 10 days.
The Japanese yen JPY= weakened 0.19% to 105.99 per dollar.
In commodity markets, oil prices were on track for a small
weekly loss, with Brent crude futures LCOc1 slipping to $44.29
a barrel and U.S. crude future CLc1 to $42.24 a barrel.
Gold XAU= was a touch softer at $1,935.31 an ounce.

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Global assets http://tmsnrt.rs/2jvdmXl
Global currencies vs. dollar http://tmsnrt.rs/2egbfVh
Emerging markets http://tmsnrt.rs/2ihRugV
MSCI All Country Wolrd Index Market Cap http://tmsnrt.rs/2EmTD6j
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