(Adds U.S. market open, byline, dateline; previous LONDON)
* China data, investor caution before Brexit vote, hits
markets
* China GDP grows 6.0% in third quarter, near three-decade
* Dollar weakens ahead of Brexit vote on Saturday
* Benchmark government bond yields nudge higher
By Herbert Lash
NEW YORK, Oct 18 (Reuters) - The dollar headed for its worst
week in almost four months on Friday, pummelled by sterling and
euro rallies driven by a deal on Britain's departure from the
European Union, while China's weakest growth in nearly three
decades weighed on equities.
The dollar crept lower against the euro as the common
currency enjoyed a lift from hopes a Brexit deal could improve
the odds of the euro zone avoiding a recession.
Dismal manufacturing data and worries the U.S.-China trade
war could slow euro zone economies even further has rattled the
euro this year, while fears of a disorderly Brexit has slammed
sterling.
"We can easily tell what's driving the euro, and that's a
potential Brexit deal. We're going to find out this weekend
whether this is going to turn into a realty or whether it's a
pipe-dream," said Paul Mendelsohn, chief investment strategist
at Windham Financial Services in Charlotte, Vermont.
The euro EUR= rose 0.16% to an almost two-month high of
$1.114. Sterling GBP= edged up 0.05% to a five-month high of
$1.2895.
British Prime Minister Boris Johnson confounded his
opponents on Thursday by clinching a new deal with the EU, even
though the bloc had promised it would never reopen a treaty.
Parliament will vote Saturday on a deal that could lead
shares in British-oriented businesses, such as housebuilders and
retailers, to rocket to record highs if approved. Investors also
predict the pound will rally around 5%. "The driver today is clearly the vote coming up and whether
Boris Johnson can pull the rabbit out of the hat and pull this
off," Mendelsohn said.
MSCI's gauge of stocks across the globe .MIWD00000PUS shed
0.21% while the FTSEurofirst 300 index .FTEU3 of leading
European shares fell 0.35%.
Asian stocks stumbled after China's third-quarter economic
growth slowed more than expected to its weakest pace in almost
three decades as the bruising U.S. trade war hit factory output.
Gross domestic product (GDP) rose just 6.0% year-on-year.
Chinese shares .CSI300 fell 1.2%.
Wall Street edged lower, dragged down by Johnson & Johnson
after it moved to recall a batch of baby powder, and as worries
about the global economy following China's GDP data offset a
string of earnings beats.
Robust earnings from Coca-Cola Co KO.N , Schlumberger NV
SLB.N and American Express Co AXP.N helped mitigate the
losses.
The Dow Jones Industrial Average .DJI fell 83.71 points,
or 0.31%, to 26,942.17. The S&P 500 .SPX lost 6.9 points, or
0.23%, to 2,991.05 and the Nasdaq Composite .IXIC dropped
46.25 points, or 0.57%, to 8,110.60.
U.S. Treasury yields fell as investors awaited the Brexit
vote on Saturday, with the benchmark 10-year U.S. Treasury note
US10YT=RR last up 5/32 in price to yield 1.7396%.
Oil prices steadied as concern over slower growth in China,
the world's biggest oil importer, was countered by bullish
signals from the Chinese refining sector, as well as optimism
surrounding the U.S.-China trade war.
Benchmark Brent crude oil futures LCOc1 fell 12 cents to
$59.79 a barrel. U.S. West Texas Intermediate (WTI) crude CLc1
futures rose 6 cents to $53.99 a barrel.
GBP loses Brexit deal boost https://tmsnrt.rs/2MtqzNH
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