By Sinéad Carew and Tom Wilson
NEW YORK/ LONDON (Reuters) -MSCI's global equities gauge fell for a third day in a row and oil prices lost ground on Wednesday, while safe-haven assets such as U.S. Treasuries and Japan's yen were in demand as mixed batch of economic data fueled concerns about slowing growth.
Crude oil futures settled down more than 1% in their third straight day of declines, including a more than 4% loss on Tuesday, due to fears about demand for coming months.
In U.S. Treasuries, yields were lower and earlier in the day, the closely watched yield curve between two-year and 10-year notes turned positive after data showed that U.S. job openings fell to a 3-1/2-year low in July.
On Tuesday, Wall Street stock indexes had registered their biggest daily percentage drops since early August as investors took profits while weak U.S. manufacturing data did little to boost risk appetites.
On Wednesday, the S&P 500 ended lower after spending the morning flitting between red and green as investors waited anxiously for more economic data. Thursday will bring a reading on the U.S. services industry with jobless claims data.
Then Friday's hotly anticipated August report for nonfarm payrolls is expected to provide the clearest clues as to the health of the U.S. economy and whether the Federal Reserve will cut interest rates this month by a quarter or a half of a percentage point.
"In a historically weak month for stocks, investors are acting more cautious and more concerned about the growth outlook than the inflation outlook," said Anthony Saglimbene, chief market strategist at Ameriprise Financial in Troy, Michigan.
Wednesday's data was already a mixed bag.
A Commerce Department report showed new orders for U.S.-manufactured goods increased more than expected in July, boosted by defense aircraft. But demand elsewhere was moderate with borrowing costs high.
U.S. job openings in July dropped to their lowest level since January 2021, suggesting the labor market was losing steam and leading traders to add to bets that the Fed will deliver a half-a-percentage-point cut in rates at its meeting this month.
"The setup is changing. Maybe three-four months ago, markets would feel good about a 50 basis point cut. Now a 50 basis point cut would signal that growth is slowing more than expected and that the Fed is behind the curve," said Ameriprise's Saglimbene.
Also on Wednesday, Atlanta Federal Reserve President Raphael Bostic said the U.S. central bank must not keep interest rates too high much longer or it risks harming employment too much.