GLOBAL MARKETS-Stocks rise as investors cling to hopes for US rate cuts

By Wayne Cole and Amanda Cooper

SYDNEY/LONDON, Aug 4 (Reuters) - Global stocks rose on Monday, boosted by the prospect of lower interest rates, after a weak U.S. jobs report prompted a dramatic re-assessment of the rate outlook and ignited concern over the reliability of U.S. economic data.

Friday's U.S. nonfarm payrolls report for July missed expectations and revised the figures for May and June sharply lower, sparking a selloff on Wall Street and denting the dollar.

By Monday, with the chance of a September rate cut from the Federal Reserve at 85%, some stability returned to the broader market, allowing Europe's STOXX 600 .STOXX to rise 0.5% in morning trading. The dollar =USD edged up against a basket of six other major currencies.

Downward revisions in the payrolls report left the three-month average of jobs growth at 35,000, down from 231,000 at the start of the year.

"I guess the biggest takeaway from all that is the net revision. We’ve all seen poor NFP prints in the past, that we can explain away as a ‘one-off’, but such a chunky net downward revision suggests that this could well be a more pronounced weakening in labour market conditions that is underway," Pepperstone market strategist Michael Brown said.

President Donald Trump's decision to fire the head of Labor Statistics in response added an extra layer of nervousness over the credibility of U.S. economic data.

News that Trump would get to fill a governorship position at the Fed early added to worries about the politicization of interest rate policy.

"It opens the prospect of broader support on the Fed Board for lower rates sooner rather than later," Ray Attrill, head of FX research at NAB, said.

"Fed credibility, and the veracity of the statistics on which they base their policy decisions, are both now under the spotlight."

Markets have essentially already eased for the Fed, with two-year Treasury yields US2YT=RR down almost 25 basis points on Friday in the biggest one-day drop since August last year.

DOLLAR DENTED

Wall Street futures ESc1, NQc1 rose 0.5-0.6%, suggesting some recovery after Friday's washout that drove the S&P 500 down .SPX 1.6% and the Nasdaq .IXIC down 2.2%.

The dollar, which fell 1.4% on Friday in its biggest one-day fall since April, rose broadly, leaving the euro EUR=EBS down 0.1% at $1.1578. The pound meanwhile edged up to $1.3307 ahead of a widely expected quarter-point rate cut on Thursday from the Bank of England that traders have priced in for some time. 0#GBPIRPR

The Swiss franc CHF=EBS took a beating, leaving the dollar up 0.6% as markets reopened in Zurich after a public holiday on Friday, when Trump announced a 39% tariff on Swiss imports.

The dollar was also up 0.1% against the yen at 147.52 JPY=EBS, having shed an eye-watering 2.3% on Friday.

In commodity markets, gold XAU= was little changed at $3,364 an ounce, having climbed more than 2% on Friday, while oil prices extended their latest slide after OPEC+ agreed on Sunday to another large rise in output for September.

The increase completely reverses last year's cuts of 2.2 million barrels per day. Brent crude futures LCOc1 were down 1.7% at $68.48 a barrel.

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