Global stocks rise after ISM data, euro down ahead of ECB meeting

NEW YORK, (Reuters) - U.S. shares rebounded slightly on Wednesday after strong data on the U.S. services sector, while soft European economic data weighed on European equities and weakened the euro a day ahead of a closely watched European Central Bank policy meeting.

Better-than-expected data on U.S. services sector growth drove gains on Wall Street, reversing earlier losses on an industry report that showed weakness in the U.S. private-sector labor market. Yields on benchmark 10-year U.S. Treasury notes edged higher.

MSCI's all-country world index of equity performance in 45 countries rose 0.12 point, or 0.03 percent, to 422.16, while the pan-European FTSE Eurofirst 300 index of regional shares closed flat at 1,374.75.

The Institute for Supply Management said its U.S. services sector index rose to 56.3 in May from 55.2 in April, topping expectations for a read of 55.5. A reading above 50 indicates expansion.

"The ISM number was a clear beat and reversed us," said Robert Francello, head trader at Apex Capital in San Francisco. "People wanted to see something at least solid to keep us stable before the ECB tomorrow."

Earlier, the ADP National Employment Report showed that about 179,000 private-sector jobs were added in May, well below the 210,000 that had been expected. April's job gains were revised downward by 5,000.

The government will release its more comprehensive labor report on Friday.

The Dow Jones industrial average rose 19.96 points or 0.12 percent, to 16,742.3, the S&P 500 .SPX gained 4.37 points, or 0.23 percent, to 1,928.61, and the Nasdaq Composite added 21.138 points, or 0.5 percent, to 4,255.219.

The euro EUR= was last down 0.17 percent, at $1.3604, after data showed the 18-nation bloc's economy expanded by just 0.2 percent in the three months to March, cementing investor expectations that the ECB is headed for further monetary easing on Thursday.

"It seems unlikely the ECB would disappoint in terms of action," said CMC Markets analyst Jasper Lawler.

The dollar held near a 3-1/2-month high against a basket of currencies after getting a lift from rising Treasury rates following the services sector data. The dollar index, which tracks the greenback versus a basket of six currencies, rose 0.089 point, or 0.11 percent, to 80.643.

Benchmark 10-year Treasury notes were last down 3/32 in price to yield 2.6039 percent, with the yield rising to levels not seen since mid-May.

Brent crude for July delivery LCOc1 erased earlier gains to edge lower and was last down 20 cents, or 0.18 percent, at $108.62 a barrel. U.S. crude CLc1 was last up 1 cent, or 0.01 percent, at $102.67 per barrel.

(Reporting by Sam Forgione; additional reporting by Marc Jones and Lionel Laurent in London, Blaise Robinson in Paris, and Ryan Vlastelica in New York; Editing by Chizu Nomiyama and Leslie Adler)