(Updated at 11:03 a.m. ET (1503 GMT))

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Spot gold prices fall

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Euro zone business activity expanded in August, PMIs show

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Markets wait for Fed's Jackson Hole comments

By Chris Prentice and Elizabeth Howcroft

NEW YORK/PARIS, Aug 21 (Reuters) - Global equities were

lower and gold prices eased on Thursday, as traders avoided

making big moves and waited for the Federal Reserve's three-day

annual Jackson Hole symposium.

The symposium starts on Thursday and the focus will be on

Fed Chair Jerome Powell's speech on Friday as traders look for

hints about the likelihood of a September U.S. rate cut. U.S.

Treasury yields inched higher as the meeting kicked off.

Oil futures advanced, bolstered by signs of strong U.S.

demand and uncertainty over efforts to end the war in Ukraine.

The U.S. dollar also gained, adding 0.35% against a basket

of other currencies.

Stocks stayed near recent highs during Asian trading, and

Australia's benchmark hit a new record. But European and

U.S. markets were under pressure, and the MSCI World Equity

Index retreated 0.21%.

"People are sitting on their hands. You have a couple of big

known unknowns coming, with Jackson Hole tomorrow and the Fed in

September," said Tim Graf, head of macro strategy for EMEA at

State Street Markets.

"This is the time to send the message, if you're going to

ease, that it's coming," he said. "But I can also see them

saying, we don't know the full effect of tariffs and inflation

pressure is still not quite out of the economy, and being a bit

more balanced."

On Wall Street, the S&P 500 was down 0.17%, the Dow Jones

Industrial Average fell 0.24% and the Nasdaq Composite

eased 0.07%.

Traders had ramped up bets for a September cut following a

surprisingly weak payrolls report at the start of this month,

and were further encouraged after consumer price data showed

limited upward pressure from tariffs.

But they lowered their expectations slightly following the

release of minutes from the Fed's July meeting. By Thursday,

markets were pricing in a 79.6% chance of a September rate cut,

compared to 83% on Wednesday, according to LSEG data.

The pan-European STOXX 600 lost 0.04%.

Analysts attributed a pullback in tech stocks this week to

concerns that AI investments were not delivering returns.

Euro zone business activity accelerated in August, PMI data

showed, with Germany registering its fastest growth since March

and France's downturn easing.

Euro zone bond yields were mostly higher, with the benchmark

10-year German Bund up 2.5 basis points at 2.751%.

The 10-year U.S. Treasury yield rose 3.7 basis points to

4.334%.

The euro was down 0.32% at $1.1614.

U.S. President Donald Trump intensified his effort to

influence the Fed on Wednesday, calling on Governor Lisa Cook to

resign on the basis of allegations made by one of his political

allies about mortgages she holds in Michigan and Georgia. Cook

said she had "no intention of being bullied to step down" from

her position at the central bank.

Deutsche Bank analysts in a research note attributed a rise

in gold overnight to renewed concerns about the Fed's

independence.

"The news was a reminder of the lingering concerns over

future Fed independence and risks of fiscal dominance, though

the extent of the market reaction was fairly modest," Deutsche

Bank said.

State Street Markets' Tim Graf said that although central

bank independence was considered "sacrosanct" by markets, it was

not yet problematic.

"Markets quite rightly look through this, price maybe a

little bit of risk premium for sure, but it's not something that

I think really upsets the apple cart too much," he said.

Spot gold prices edged lower, down 0.09% at $3,343.69 per

ounce, while gold futures added 0.01%.

Elsewhere in commodities, Brent oil futures rose

0.49% to $67.17 per barrel and U.S. crude gained 0.48% to

$63.01.