NEW YORK (Reuters) - Global equity markets were flat on Monday, with safe-haven assets such as the U.S. dollar and gold making gains as signs of economic recovery pointed to the likelihood of near-term cuts in central bank stimulus.
China's CSI300 <.CSI300> share index climbed 2.1 percent, extending last Friday's rise after factory output grew in July at its fastest pace since the start of the year.
The dollar gained, with expectations rising that strong U.S. data will prompt the Federal Reserve to act sooner rather than later to trim its monthly purchase of about $85 billion in bonds.
Gold hit its highest in nearly three weeks in thin trade, and the world's biggest gold exchange-traded fund, SPDR Gold Trust, recorded its first inflow in two months on Friday, growing by 0.2 percent to 911.13 tonnes.
Spot gold rose as much as 2.2 percent to $1,343.06 an ounce, its highest since July 24. It was last at $1,336.78.
Several Fed officials have said the central bank could move as early as September if the U.S. economy continues to improve. But many investors fear slower growth without the Fed's support, which has helped fuel a nearly 19 percent gain in the benchmark S&P 500 index so far this year.
Some equity investors believe the equity market's recent stall is nothing more than a pause in the rally.
"This is a back-and-fill after the remarkable move we've seen this year, and that's healthy," said Chris Bertelsen, chief investment officer of Global Financial Private Capital in Sarasota, Florida.
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Signs that China's slowdown may have run its course and expectations that data this week will indicate the euro zone is pulling out of its longest recession on record are bolstering hopes that the global economy is gaining strength.
Wall Street was little changed, with the Nasdaq slightly higher, while European shares traded near break-even. MSCI's all-country world index <.MIWD00000PUS>, a measure of 45 equity markets around the world, was down 0.06 percent.
The Dow Jones industrial average <.DJI> was down 13.63 points, or 0.09 percent, at 15,411.88. The Standard & Poor's 500 Index <.SPX> was down 2.28 points, or 0.13 percent, at 1,689.14. The Nasdaq Composite Index <.IXIC> was up 6.60 points, or 0.18 percent, at 3,666.71.
"We shouldn't equate the all-time highs with the market being rich. There's still value in the market, but in the short term we've gotten ahead of ourselves," said Matthew Keator, partner in the Keator Group, a wealth management firm in Lenox, Massachusetts.
European shares steadied around two-month highs. The FTSEurofirst 300 <.FTEU3> index of top regional shares rose 0.04 percent to close at 1,230.03.
The dollar slipped against the yen early on Monday after data showed Japan's economy grew an annualized 2.6 percent in the period from April to June, a third straight quarter of expansion, though slower than expected.
But the yen then reversed those gains, with the dollar up 0.26 percent at 96.45 yen. Against the euro, the yen was up slightly at 128.36.
The benchmark 10-year U.S. Treasury note was up 1/32 to yield 2.5766 percent.
Brent crude oil dropped below $108 per barrel after a sharp rally on Friday. Losses were checked, however, by supply outages in major producers Libya and Iraq.
Brent was up 35 cents to $108.57 a barrel. U.S. crude was up 19 cents at $106.16.
(Additional reporting by Marc Jones in London; Editing by Dan Grebler)
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