* Global stocks slip despite a less fearsome jobs report
* U.S. dollar falls vs euro after tepid U.S. jobs data
* Bonds slip after recent rally on profit-taking
* Crude oil falls to near $72 a barrel after jobs data
(Adds close of European markets)
By Herbert Lash
NEW YORK, July 2 (Reuters) - Global stocks eased and crude oil
fell on Friday after reports on U.S. manufacturing and payrolls data
were worse than expected, adding to worries that economic growth
appears tepid at best in the near future.
The price of German Bund futures fell while European shares pared
early strong gains but still ended higher as a U.S. employment report
failed to live up to grim expectations, relieving some fears of a
U.S. double-dip recession. For details see: []
A string of disappointing reports on consumer spending, the
housing market and factory activity has fueled forecasts that the
U.S. economy is slipping back into a recession.
U.S. private payrolls rose only modestly in June and overall
employment fell for the first time this year as thousands of
temporary jobs with the U.S. Census ended, suggesting the economic
recovery is failing to gain traction.
Another government report showed new orders for U.S. factory
products tumbled much more than expected in May, posting their
sharpest drop since the depth of the recession and their first
decline in nine months.
"They weren't as bad, I suspect, as some had feared," Julian
Jessop, fixed-income strategist at Capital Economics, said about the
data. "What seems to be happening is that people are a bit less
worried now about the idea the U.S. economy is already sliding into a
double-dip recession."
MSCI's all-country world equity index <.MIWD00000PUS> dipped 0.1
percent, while its emerging markets index <.MSCIEF> gained 0.3
percent.
The pan-European FTSEurofirst 300 <> index of top shares
rose 0.1 percent to close at 969.66 points. For the week, the index
lost 4.3 percent.
"There was palpable relief over today's payrolls data," said
Michael Hewson, an analyst at CMC Markets. "We subsequently got
prompted a small relief rally as the market looked to have factored
in a much worse number," he said.
At around 1 p.m., the Dow Jones industrial average <> was
down 108.86 points, or 1.12 percent, at 9,623.67. The Standard &
Poor's 500 Index <.SPX> was down 10.76 points, or 1.05 percent, at
1,016.61. The Nasdaq Composite Index <> was down 21.95 points,
or 1.04 percent, at 2,079.41.
Technical measures on the S&P 500 weakened further after the
benchmark index's 50-day moving average broke below its 200-day
moving average, suggesting more downside pressure.
This "death cross" -- a shorter-term average falling below a
longer-term average -- last occurred between the two averages in
December 2007, soon after the market began a decline that eventually
took the S&P 500 to 12-year lows in March 2009.
The U.S. dollar fell against the euro, extending Thursday's steep
losses, and the price of U.S. Treasuries slipped. []
[]
The euro <EUR=> was up 0.30 percent at $1.2554 as investors
looked past economic problems in the euro zone and focused on the
possibility of a stalled U.S. economic recovery.
Europe's single currency already was bolstered by easing concerns
about a tightening of euro-zone liquidity after banks showed a lower
need for European Central Bank funding and successful bond auctions
on Thursday.
The dollar was down against a basket of major currencies, with
the U.S. Dollar Index <.DXY> off 0.27 percent at 84.489, but against
the yen, the dollar <JPY=> was up 0.07 percent at 87.66.
Bond prices see-sawed before losing ground as traders scrutinized
the payrolls data. Some traders had bet on an even worse result,
making the actual showing not so bad by comparison and limiting the
upside to Treasury prices.
The benchmark 10-year U.S. Treasury note <US10YT=RR> was down
3/32 in price to yield 2.96 percent.
Crude oil prices fell on mounting concerns about a faltering U.S.
economic recovery.
U.S. crude oil futures <CLc1> fell 97 cents to $71.98 a barrel.
ICE Brent crude oil futures <LCOc1> fell 72 cents to $71.62.
"The data that we are seeing this week in the U.S. and in China
is causing extra nervousness among investors, which probably is a bit
exaggerated," said William de Vijlder, chief investment officer at
BNP Paribas Investment Partners.
"But risk appetite is already low and this is an extra factor
which is pushing people to have a wait-and-see attitude," de Vijlder
said.
Earlier in Asia, stocks gave up early gains to trade flat as
investors remained nervous ahead of the closely followed U.S. jobs
report.
Japan's Nikkei average <> ended a touch firmer after choppy
trade, rising 0.13 percent to close at 9,203.71, just above the key
9,200 support level, while the MSCI index of Asia Pacific stocks
outside Japan <.MIAPJ0000US> fell 0.1 percent.
(Reporting by Angela Moon, Nick Olivari, Burton Frierson and Richard
Leong in New York; Ikuko Kurahone and William James in London; Lucia
Mutikani in Washington; Writing by Herbert Lash)
