GLOBAL MARKETS-Profit-taking hits buoyant euro, stocks

                                
 * Profit-taking hits euro, European shares
                                
 * Euro zone service data strong but shows recovery uneven
                                
 * Inflation worries weigh on emerging markets
                                
 
                                
 By Jeremy Gaunt, European Investment Correspondent
                                
 LONDON, Jan 24 (Reuters) - Profit-taking took the euro off
two-month highs on Monday and caused euro zone stocks to pare
back recent gains amid signs of an improving if uneven recovery
by the region's economy.
                                
 Debt-ridden Ireland's politics were in focus and emerging
market stocks were weak, hurt by inflation worries.
                                
 The flash purchasing manager services index for the single
currency zone came in above expectations, confirming gathering
strength. Markit's index, comprising surveys of around 2,000
businesses ranging from banks to hotels, rose to 55.2 from 54.2
in December, comfortably beating expectations of 54.3.
                                
 Worries about euro zone debt have eased in recent weeks on
the back of renewed economic vigour in core economies and on
hopes for a beefing-up of the bloc's rescue fund.
                                
 German Finance Minister Wolfgang Schaeuble was quoted on
Sunday as saying the country's conservative coalition government
wants to deliver a comprehensive package soon to strengthen the
EFSF bailout fund. [ID:nLDE70M05F]  
                                
 But there is also concern about Ireland, which has been at
the centre of the crisis, after its junior coalition party
withdrew from Prime Minister Brian Cowen's government on Sunday,
signalling the end of a crisis-riddled administration and
hastening an election due on March 11. [ID:nLDE70M0AH]
                                
 "You've got to think Ireland's going to come under some
pressure... but it remains to be seen whether that upsets the
positive tone in the rest of the periphery," a bond trader said.
                                
 The euro was down half a percent at $1.3569 <EUR> but only
after hitting a new two-month high of $1.3648 in early Asian
trading.
                                
 Speculators turned long on the euro for the first time in
two months in the week ended Jan. 18 while doubling their bets
against the dollar, figures from the Commodity Futures Trading
Commission showed on Friday.
                                
 
                                
 STOCKS SLIP
                                
 World shares as measured by MSCI <>MIWD00000PUS> were
slightly lower, weighed down by European and emerging market
stocks.
                                
 The FTSEurofirst 300 <.FTEU3> index of top European shares
was down 0.4 percent, having started in positive territory. It
has been an outperformer for much of this year.
                                
 Philips Electronics <PHG.AS> weighed on the index, after
reporting lower-than-expected fourth-quarter net profit on poor
TV sales. It warned that consumers in mature markets will be
reluctant to spend this year.
                                
 Earlier, concerns about rising inflation gave investors an
excuse to book profits in some Asian markets after strong
rallies in 2010, but rather than exiting the region, funds were
being reallocated to countries seen as having a better grip on
price pressures.
                                
 Japan's Nikkei average <.N225> rose 0.5 percent, with
resource shares popular and recently beaten-down exporters
bought amid expectations of robust earnings reports from
Japanese firms this week. [.T]
                                
Spot gold <XAU=> rose around 0.5 percent to around $1,350 per
ounce, after posting its third consecutive weekly loss.
[ID:nL3E7CO00X].
                                
(Editing by John Stonestreet)