* Lull in momentum as Wall Street scales record peaks
* Dollar bounce runs out of puff as U.S. labour market looks
weak
* German, French, EZ PMIs below expectations
* China's yuan surges to 7-month high
By Karin Strohecker
LONDON, Aug 21 (Reuters) - Global stock markets enjoyed
cautious gains on Friday, taking their cue from Wall Street tech
shares, but tepid economic data and lofty valuations reined in
the advances in the wake of huge rally that has wiped out
coronavirus losses.
Global stocks advanced 0.2% .MIWD00000PUS while the
pan-European STOXX 600 climbed 0.4% .STOXX after healthy gains
in Asian-Pacific bourses .MIAPJ0000PUS in the wake of U.S.
tech shares closing higher on Thursday, shrugging off some
sombre unemployment data in the world's top economy.
European stock markets also looked beyond 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 a slowing momentum
in the recovery. "European stocks shrug off faltering flash PMIs," said
Michael Hewson, chief market analyst at CMC Markets.
"The latest flash PMI data for August in France and Germany
would appear to point to a plateauing in economic activity,
particularly in the services sector, where rising infection
rates here could well be tempering economic activity on the
margins."
A stronger pound weighed on UK's export-heavy FTSE 100.
Meanwhile U.S. futures ESc1 NQc1 pointed to a flat open.
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
Overnight, clouds returned to the U.S. labour market
outlook, with weekly jobless claims back over a million to put
the total number of Americans on unemployment benefits at 28
million.
The Philadelphia Federal Reserve's business index also
missed expectations and together the weak readings pushed down
nominal U.S. yields and dragged on the dollar. Benchmark U.S.
10-year debt US10YT=RR yields were last steady at 0.6461%.
DOLLAR BLUES
In currency markets, the euro inched higher EUR=EBS to sit
at $1.1838 with the dollar weighed down by concerns over the
strength of a U.S. economic recovery in the wake of the jobs
data.
A bounce in the greenback after Federal Reserve minutes that
fell short of dovish market expectations wore off fairly quickly
and the dollar looked set for a ninth consecutive weekly loss
against a basket of currencies =USD . FRX/
The Japanese yen JPY= inched up to 105.59 after an
inflation miss supported real yields while China's yuan surged
to a seven-month high as traders bet on Chinese growth.
Meanwhile sterling GBP= sat flat against the dollar to sit
at $1.3222.
In commodity markets, the prospect of production cuts had
oil prices on track for a small third straight weekly gain. On
the day, Brent crude futures LCOc1 slipped a slither to $44.84
a barrel and U.S. crude future CLc1 to $42.73 a barrel.
Gold XAU= was a touch softer at $1,936.7 an ounce.
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Global currencies vs. dollar http://tmsnrt.rs/2egbfVh
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MSCI All Country Wolrd Index Market Cap http://tmsnrt.rs/2EmTD6j
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