July 17, 2018 / 12:01 PM / 3 months ago

GLOBAL MARKETS-World stocks slip on oil as focus turns to Fed

* World stocks turn lower as oil hits 3-month low

* Dollar steady ahead of Fed testimony

* Most other markets calm, awaiting Powell

* Chinese stocks slide on growth fears

* For a live blog on European stocks, type LIVE/ in an Eikon news window

By Alasdair Pal

LONDON, July 17 (Reuters) - Global stocks fell on Tuesday as oil prices hit a three-month low, while the dollar edged lower and most other markets were subdued before Federal Reserve Chair Jerome Powell was due to testify to the U.S. Congress.

MSCI’s world equity index, which tracks shares in 47 countries, fell 0.1 percent, with energy companies in Europe and Asia among the biggest losers. European energy stocks were down 0.6 percent.

Brent crude hit a three month low on Tuesday after slumping 4 percent on Monday, as Libyan ports reopened and traders eyed potential supply increases by Russia and other producers..

The number of fund managers believing oil to be overvalued is now at its highest level since April 2012, according to a survey by Bank of America Merrill Lynch released on Tuesday.

Europe’s Stoxx 600 fell 0.3 percent, with futures also pointing to a lower open for the U.S. S&P 500, last seen down 0.2 percent.

MSCI’s broadest index of Asia-Pacific shares outside Japan fell 0.4 percent, snapping two days of gains amid concern over growth in China.

In Europe, technology stocks fell 0.4 percent after U.S. tech giant Netflix missed estimates for growth in subscribers.

The company’s shares are expected to open as much as 14 percent lower on Tuesday, traders said, hitting the Nasdaq that is trading 0.1 percent lower pre-market.

POWELL TIME

Elsewhere, many asset classes were flat as investors waited for Powell’s testimony, expected to begin at 1400 GMT.

In currencies, the dollar index was broadly flat against a basket of six major currencies at 94.549.

The index shed 0.25 percent on Monday, nudging away from a two-week high of 95.241 on Friday.

“It’s been a fairly sluggish and unexciting start to the week for markets. Whether things get more interesting or not probably depends on what Fed Chair Jerome Powell has to say when he testifies today in front of the Senate Banking Committee,” said Craig Nichol, a macro strategist at Deutsche Bank.

Powell will testify on the economy and monetary policy before the U.S. Senate Banking Committee on Tuesday and the House of Representatives Financial Services Committee on Wednesday.

He is likely to reiterate the Fed’s stance towards gradual monetary policy tightening. Markets will focus on his views on recent trade tensions.

“In short, we expect the chairman to signal optimism on growth and inflation, consistent with continued ‘gradual’ tightening,” wrote Jim O’Sullivan, chief economist at High Frequency Economics.

“He will undoubtedly acknowledge some downside risks associated with the administration’s trade warmongering, but he will likely try to avoid sounding critical of the administration.”

Even before Powell’s testimony, traders said the Sino-U.S. trade conflict was keeping a keeping a lid on equity prices and currencies in both countries.

The Chinese government said on Tuesday it would hit its 2018 growth target, a day after it reported slower growth in the second quarter and the weakest expansion in factory activity in June in two years.

Economists at UBS lowered their estimates for Chinese gross domestic product to take into account trade war escalation, warning clients the country’s currency was likely to weaken.

Chinese stocks were among the biggest losers in Asia on Tuesday, falling 1.7 percent.

Trading in government bonds was largely subdued ahead of Powell’s testimony. Euro zone government bond yields across the currency bloc inched lower by 0.5 to 2 basis points, with investors unwilling to push yields any higher before Powell testifies. (Reporting by Alasdair Pal, additional reporting by Shinichi Saoshiro in Tokyo, editing by Gareth Jones)

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