* Dow, S&P 500 fall; Nasdaq unchanged
* 10-year yields fall to two-week low; yield curve flattens
* Gold gains as dollar, crude fall
NEW YORK, Oct 27 (Reuters) - Global equity markets gave up
recent gains on Wednesday, while U.S. Treasury yields fell to a
two-week low as traders weighed continued positive corporate
results and a resurgence in U.S.-China tensions that could
compound supply-chain worries.
Major U.S. companies, including tech giants Microsoft Corp
and Google parent Alphabet Inc, have been
reporting stronger-than-expected earnings, helping to lift the
S&P 500 and Dow Industrials to record closing
highs this week, while the tech-heavy Nasdaq is 1% off
its record peak.
But the U.S. telecoms regulator voted on Tuesday to revoke
the authorization for China Telecom's U.S. subsidiary
to operate in the United States, opening up a new front in the
already tense relationship between the world's two biggest
economies and exacerbating investor concerns about supply
"This is obviously one of the most intense reporting weeks
for tech stocks, and companies that have been real darlings are
still reporting significant numbers," said Tom Plumb, portfolio
manager at the Plumb Balanced Fund.
"There's been a dichotomy between those companies that have
reacted proactively to supply chain issues compared with those
that were waiting for a thaw in the U.S. relationship with the
The MSCI world equity index, which tracks
shares in 50 countries, dropped 0.55%, while the pan-European
STOXX 600 index fell 0.36%.
On Wall Street, the Nasdaq was unchanged on Wednesday, while
the Dow and the S&P 500 closed lower, dragged down by cyclical
sectors including financial, healthcare, energy and industrials.
The Dow Jones Industrial Average fell 0.74% to
35,490.69, the S&P 500 lost 0.51% to 4,551.68 and the
Nasdaq Composite was unchanged at 15,235.84.
U.S. benchmark 10-year Treasury yields dropped to a two-week
low while the 2-year Treasury yields hit 19-month highs, further
flattening the yield curve, as the possible timing of the
Federal Reserve's first interest rate rise came into sharper
U.S. 10-year yields dropped to 1.552%, while the
2-year yields spiked to 0.515%, the highest since
The U.S. dollar lost value against major currencies on
Wednesday after the Bank of Canada started off a series of
awaited central bank policy comments with a hawkish tone.
The moves broke a calm that had settled over the currency
markets this week and took the U.S. dollar index down
0.101% to 93.858.
Prices of safe-haven gold rose in seesaw trading, buoyed by
a fall in U.S. bond yields and a softer dollar, although strong
risk appetite in equity markets kept bullion's gains in check.
Spot gold was up 0.21% at $1,796.48 per ounce, after
a sharp fall in the previous session.
Oil prices fell after U.S. crude oil stockpiles rose more
than expected, even as fuel inventories dropped and tanks at the
nation's largest storage hub emptied further.
Brent oil futures ended down 2.1% to $84.58 a
barrel, while U.S. West Texas Intermediate (WTI) crude
settled down 2.4% to $82.66 a barrel.
(Reporting by Chibuike Oguh in New York; editing by David Evans
and Sonya Hepinstall)