(Updates prices to U.S. morning trading)

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Equities fall on dampening rate cut hopes

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Dollar holds gains while Treasury yields rise

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Switzerland keeps interest rates at zero

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Oil eases back from 7-week closing high

By Sinéad Carew and Marc Jones

NEW YORK/ LONDON, Sept 25 (Reuters) - MSCI's global

equities gauge was falling while bond yields rose as investors

worried that Thursday's stronger than expected economic data

would make the Federal Reserve more cautious about cutting

interest rates while they monitored comments from central bank

officials for clues on their rate policy path.

The U.S. economy grew faster than previously thought in the

second quarter, pumped up by an ebb in imports and a pickup in

consumer spending, but momentum appears to have since slowed,

according to a report from the Commerce Department's Bureau of

Economic Analysis. Second quarter gross domestic product

increased at an upwardly revised 3.8% annualized rate versus

initial reports of a 3.3% pace.

New orders for key U.S.-manufactured capital goods unexpectedly

increased in August, but a decline in shipments of these goods

suggested a moderate pace of growth in business spending on

equipment this quarter.

And the Labor Department said on Thursday that the number

of Americans filing new applications for unemployment benefits

fell by 14,000 to a seasonally adjusted 218,000 for the week

ended September 20. Economists polled by Reuters had forecast

235,000 claims for the latest week.

"If you're looking for continued fuel for equities to move

higher and broaden out versus what we've seen the last couple of

years, you need a continuation of the momentum that's been built

over the summer in terms of the Fed easing and easing materially

through 2026," said Matt Stucky, chief portfolio manager for

equities at Northwestern Mutual Wealth Management Company.

Also on Thursday, Fed Bank of Chicago President Austan Goolsbee

said that while he supported last week's interest-rate cut

because the labor market is cooling, he was not eager to do a

lot more policy easing while inflation is above target and

moving the wrong way.

But Fed Governor Stephen Miran said on Fox Business' Mornings

with Maria program that the U.S. economy is more vulnerable to

shocks right now due to high interest rates based on unfounded

inflation concerns among Federal Reserve policymakers.

And San Francisco Federal Reserve Bank President Mary Daly said

on Wednesday she "fully supported" the decision by the Fed to

cut its policy rate last week and expects further reductions

ahead. But regarding the timing of those cuts she said it was

"hard to say."

On Wall Street, indexes hit a one-week low after the data and

the commentary. At 11:10 a.m. the Dow Jones Industrial

Average fell 104.08 points, or 0.23%, to 46,015.55, the

S&P 500 fell 37.53 points, or 0.56%, to 6,600.98 and the

Nasdaq Composite fell 140.18 points, or 0.62%, to

22,357.54.

MSCI's gauge of stocks across the globe

fell 6.34 points, or 0.65%, to 972.91.

The pan-European STOXX 600 index fell 0.56% with

med-tech stocks coming under pressure after news of the U.S.

opening new import-related probes, and investors focused on Fed

commentary.

In government bonds, U.S. Treasury yields rose on Thursday

following stronger-than-expected second-quarter economic data

that could strengthen the case for a rates pause from the Fed at

its October meeting.

The yield on benchmark U.S. 10-year notes rose 4

basis points to 4.187% from 4.147% late on Wednesday while the

30-year bond yield rose 1.2 basis points to

4.7704%.

The two-year note yield, which typically moves in

step with interest rate expectations for the Federal Reserve,

rose 5.9 basis points to 3.657%.

In currencies, the dollar index, which measures the

greenback against a basket of currencies including the yen and

the euro, rose 0.61% to 98.43.

The euro was down 0.58% at $1.1669 while against the

Japanese yen, the dollar strengthened 0.5% to 149.65.

Against the Swiss franc, the dollar strengthened 0.7%

to 0.801 after the Swiss National Bank held interest rates at

zero on Thursday in its first pause since late 2023.

Oil prices fell on Thursday, from the previous session's

seven-week settlement high, as some investors took profits in

anticipation of slower winter demand as well as the return of

Kurdish supplies.

U.S. crude fell 0.88% to $64.41 a barrel and Brent

fell to $68.81 per barrel, down 0.72% on the day.

Safe-haven gold, which has recently been hitting record highs in

anticipation of a low-interest-rate environment, took a step

back after Thursday's data.

Spot gold fell 0.12% to $3,731.45 an ounce. U.S. gold

futures fell 0.2% to $3,724.70 an ounce.