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 There were signs that the rout wasn't over yet as Chinese stocks -
which have suffered their worst monthly drop in 6 years - wobbled
again, oil prices slipped following a more than 15 percent July
slump and metals from industrial copper to precious gold hit
multi-year lows.
That happened despite a pause in the dollar's recent rise, which has
been compounding the commodity pressure as signs build that the U.S.
Federal Reserve is heading for its first rate hike in almost a
decade.
European markets, relieved that Greece looks to be staying in the
euro after its last-minute deal this month, saw a solid start to the
day to cap a more than 4 percent monthly rise for stocks [.EU] and
the biggest drop in Italian bond yields in two years. <GVD/EU>
"The main moves this week have been the continued broad-based
weakness in commodities," said Societe Generale strategist Alvin
Tan. "Essentially they have been on the downtrend for a month and of
course we have been on a roller coaster ride in China equities and
that has affected sentiment."
 European stocks were underpinned by some upbeat company earnings.
Shares in UCB surged 5.2 percent after the Belgian pharmaceutical
company raised its 2015 forecasts and
bank BNP Paribas gained 3.5 percent after its Q2 revenue rose nearly
16 percent.
Economists were waiting for July euro zone inflation and
unemployment data due at 0900 GMT and for in-depth U.S. wage data
due later. But just as important remained commodities and China.
Copper, considered a bellwether for global economic activity, was
facing a 9 percent monthly loss as it stumbled to $5,238 an tonne.
Gold was down over 7 percent on the month at $1,081.95 an ounce as
it chalked up its longest run of week-on-week falls in 16 years.
[GOL/]
FRAGILE CHINA
China's CSI300 index ended flat after a late dip to leave it down
14.7 percent on the month, and the Shanghai Composite Index lost 1
percent, extending its July losses to 13.4 percent despite recent
support measures by the country's authorities.
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China's securities regulator said on Friday it was investigating the
impact of automated trading on the market and has clamped down on 24
trading accounts found to have abnormal bids for shares or bid
cancellations.
Crude oil also slipped for a second session as concern over global
oversupply intensified after the head of the OPEC oil exporters'
cartel indicated there would be no cutback in production. U.S. crude
was down 0.3 percent at $48.2 a barrel.
Lead by China's woes, emerging stocks looked on track to finish
their third straight month in the red, with many near multi-year
lows as the sector grappled with the prospect of U.S. rate rises and
sluggish growth data at home.
U.S. gross domestic product data released on Thursday showed growth
accelerated in the second quarter, though slightly short of some
forecasts. Growth was tweaked higher in the first quarter, backing
the Fed's assessment at its meeting this week that the economy was
expanding "moderately."
"We believe there's enough here for the Fed to raise interest rates
for the first time in nine years," said Kathy Lien, managing
director at BK Asset Management in New York.
The dollar inched down about 0.1 percent on the day to 124.030 yen,
after rising as high as 124.58 overnight, its highest level since
June 10.
The euro edged about 0.1 percent higher to $1.0938, after dropping
to a one-week low of $1.0835 on Thursday.
(Reporting by Marc Jones; Editing by Tom Heneghan)
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