* MSCI world equity index up 0.1 pct at 282.99
* M&A in Europe, Asia ease recovery concerns
* Bonds weaker; oil slips
By Natsuko Waki
LONDON, Aug 23 (Reuters) - World stocks stabilised just
above last week's one-month low on Monday as an encouraging euro
zone business survey and positive corporate merger activity news
helped ease concerns about a global economic slowdown.
Mining shares gained as financial markets bet Australia's
inconclusive weekend elections would lead to a change of
government which would spell the end to a plan to impose tax on
major iron ore and coal mines.
A Markit survey showed the euro zone's economic recovery
moderated slightly this month but companies are more optimistic
about the coming months. HSBC <HSBA.L>'s plan to buy stakes in
South Africa's Nedbank <NEDJ.J> in a potential $6.8 billion deal
also brightened investor sentiment.
In Asia, a wave of mergers is boosting values as acquirers
leverage on relatively lower valuations and cheap funding costs
to buy companies. An estimated $58 billion worth of mergers
involving Asian companies were playing out during the day.
Positive corporate news helped ease concerns that a renewed
spike in U.S. unemployment may force the Federal Reserve to
implement additional monetary easing.
"In terms of a positive trend we have some more M&A
speculation but that doesn't seem to have lit the touch paper in
terms of the market," Richard Hunter, head of UK Equities at
Hargreaves Lansdown Stockbrokers said.
"It's a continuation of the August theme of light volumes
and fragile sentiment."
MSCI world equity index <.MIWD00000PUS> rose 0.1 percent
after hitting a one-month low last week. The Thomson Reuters
global stock index <.TRXFLDGLPU> was steady on the day.
The FTSEurofirst 300 index <> was up 0.3 percent.
Markit's Eurozone Flash Services Purchasing Managers' Index,
made up of surveys of around 2,000 businesses ranging from banks
to restaurants, came in at a better-than-expected 55.6 in
August, compared with 55.8 in July. []
Old Mutual <OML.L> was up nearly five percent after HSBC
<HSBA.L> said it would buy up to 70 percent of South Africa's
Nedbank <NEDJ.J>, in which Old Mutual has a controlling stake.
Basic resources shares were the top gainers <.SXPP>.
Emerging stocks <.MSCIEF> were steady on the day.
U.S. crude oil <CLc1> fell 0.2 percent to $73.70 a barrel,
near Friday's six-week low of $73.19. Prices have fallen more
than 10 percent from an Aug 4 high of $82.97 as concerns about
the global economy darkened the outlook for energy demand.
The bund future <FGBLc1> fell 13 ticks.
ELECTION RESULTS HIT AUSSIE
The Australian dollar briefly hit a one-month low of $0.8833
<AUD=D4> after neither of the major parties in Australia won an
overall majority in Saturday's election to form a government,
leaving the country facing its first hung parliament in 70
years. []
The dollar <.DXY> was down around 0.1 percent against a
basket of major currencies. The yen rose a quarter percent to
85.35 per dollar, which in turn weighed on Tokyo stocks <>.
Japanese Prime Minister Naoto Kan and Bank of Japan Governor
Masaaki Shirakawa discussed the yen and agreed to work closely
in a phone conversation on Monday, disappointing those who had
expected a bolder policy response after the yen's surge to
15-year highs beyond 85 earlier this month.
"In the absence of a further sharp appreciation of the
exchange rate towards 80 or a disorderly slide in the equity
markets, we do not anticipate any easing of monetary policy
until the scheduled policy meeting due on Sept 6-7, when we
expect a further expansion of the BOJ's funds-supplying
facility," Daiwa Capital Markets said in a note to clients.
(Additional reporting by David Brett; Editing by Toby Chopra)
