(Adds oil, gold settlement prices)
* Graphic: 2020 asset performance http://tmsnrt.rs/2yaDPgn
* Graphic: World FX rates in 2020 http://tmsnrt.rs/2egbfVh
NEW YORK, Aug 7 (Reuters) - The dollar bounced off two-year
lows and a gauge of global equity markets stopped marching
toward a record high on Friday, as slightly
better-than-expected data on U.S. job growth in July also
snapped big rallies in gold and the euro.
A U.S. Labor Department report showed employment growth
slowed considerably from June amid a surge in COVID-19 cases.
Though the job numbers topped expectations, the report
highlighted the need for the White House and Congress to reach
an agreement on a new stimulus bill.
Gold slid 2% to snap its record surge this week above
$2,000, the euro fell from highs against the dollar last seen in
May 2018 and U.S. Treasury yields rose, halting a downward move
that had the benchmark 10-year note poised to fall below 0.5%.
The sell-off was due to profit-taking after the record peaks
this week in gold and the tech-driven Nasdaq, as the value of
the dollar ebbed, said Axel Merk, president and chief investment
officer of Merk Investments LLC in San Francisco.
"We've had such a dramatic move. It's been dollar-centric,
call it a profit-taking reversal. I don't think there is a
change in environment," said Merk, adding: "I can tell you
what's causing this. It's Friday."
European equities eked out modest gains, with the
pan-regional FTSEurofirst 300 index adding 0.27%. But
the euro's sharpest sell-off since April helped Germany's
export-heavy DAX index to close up 0.66%.
Stocks on Wall Street at first meandered, with the S&P 500
and Nasdaq trying to turn positive, without luck.
The Dow Jones Industrial Average fell 0.13%, the S&P
500 lost 0.23% and the Nasdaq Composite dropped
MSCI's benchmark for global equity markets
fell 0.55% to 562.04.
The dollar index rose 0.662%, with the euro
down 0.8% to $1.178. The Japanese yen weakened 0.37%
versus the greenback at 105.93 per dollar.
Financial markets remain focused on the potential passage of
another stimulus bill in Congress, but the White House and
Democrats appear far apart after nearly two weeks of talks that
have failed to produce substantial progress.
Democrats in Congress said on Friday they offered to reduce
a proposed coronavirus aid package by a trillion dollars if
Republicans would add a trillion to their counter-offer, but the
idea was flatly rejected by the White House.
Also weighing on markets was U.S. President Donald Trump's
sweeping ban, unveiled late Thursday, on U.S. transactions with
the Chinese owners of messaging app WeChat and video-sharing app
In response, China said the companies complied with U.S.
laws and warned Washington would have to "bear the consequences"
of its action.
Chinese stocks led losers in Asia and the yuan slumped after
Trump issued executive orders to purge "untrusted" Chinese apps
from U.S. digital networks.
Hong Kong's Hang Seng fell 1.6%. Tencent,
Asia's second-biggest company by market capitalization, dropped
as much as 10.1% and closed down 5.0%.
Mainland China's CSI 300 Index fell 1.15% despite
strong export data, while Japan's Nikkei slipped 0.4%.
The latest Bank of America fund flow statistics also
confirmed the undercurrent of caution in global markets, with
investors flocking to cash, gold and investment-grade bonds and
switching out of equities.
Gold hit a record high of $2,072.5 an ounce overnight
in Asia, before succumbing to profit-taking.
Spot gold prices fell -1.47% to $2,032.96 an ounce.
U.S. gold futures settled down 2% at $2,028.
Silver dropped 1.7% to $28.452 per ounce following
its rise to a seven-year high of $29.838.
Oil prices fell more than 1%, pulling back from a week of
Brent crude futures slid 69 cents to settle at
$44.40 a barrel, while U.S. crude futures settled down 73
cents at $41.22 a barrel.
(Reporting by Herbert Lash; additional reporting by Kate Duguid
and Saqib Iqbal Ahmed in New York; Editing by Dan Grebler and