* European shares turn lower, U.S. shares drop
* Philly Fed data the latest data implying weakness
* Spain sees successful debt sale on rate cut hopes
By Ryan Vlastelica
NEW YORK, April 18 (Reuters) - Stock markets around the world dipped on Thursday, fluctuating between gains and losses as investors worried about the economic outlook following weak U.S. data but also looked for a rebound from recent declines.
Oil held steady while European shares turned lower from early advances. U.S. shares fell and extended their decline for the week, with the S&P 500 down about 3 percent so far this week, on pace to post its worst week since June 2012.
Stocks fell sharply in Wednesday's session and early trading had indicated a rebound until the latest data supported views that equity markets, which posted strong gains in the first quarter, have gotten over-extended.
Growth in factory activity in the U.S. mid-Atlantic region unexpectedly fell in April, according to the Philadelphia Federal Reserve, the latest in a series of data pointing to weak economic conditions.
"There were some hopes earlier this year that things were picking up, but instead the slow growth seems to be continuing," said John Carey, portfolio manager at Pioneer Investment Management in Boston, which has about $200 bln in assets under management. "Concerns about growth are now pretty constant."
Investors also looked to the latest corporate earnings reports for signs on the economy's strength, but results were mixed. Verizon Communications surged following a better-than-expected profit while Morgan Stanley (Xetra: 885836 - news) fell 3 percent as revenue from commodities trading fell sharply.
The Dow Jones industrial average was down 14.03 points, or 0.10 percent, at 14,604.56. The Standard & Poor's 500 Index was down 1.66 points, or 0.11 percent, at 1,550.35. The Nasdaq Composite Index was down 12.25 points, or 0.38 percent, at 3,192.43.
Europe's broad FTSE Eurofirst 300 index was down slightly, hitting its lowest point of 2013 at one point before recovering a bit. Frankfurt's DAX (Xetra: ^GDAXI - news) fell 0.4 percent while the Paris CAC-40 edged 0.1 percent higher.
Surprisingly weak economic data from China and the United States and the International Monetary Fund's decision to trim its global growth forecast have driven the recent equity market falls, offsetting support from easier global central bank policies.
Some analysts say the market move is more a timely correction after strong gains in the first quarter of the year, when optimism over the U.S. economy lifted Wall Street stocks to record peaks and boosted European shares to multi-year highs.
The benchmark 10-year U.S. Treasury note was up 2/32, the yield at 1.6898 percent.
COMMODITIES STRUGGLE FOR GROUND
The prospect of lower global growth, and with it weaker demand for goods used in industrial production, has weighed heavily on the commodity markets where copper and oil are near multi-month lows.
Copper, seen as a gauge for manufacturing and China-related growth, briefly broke below $7,000 a tonne for the first time since late 2011, with London copper futures down 1.1 percent at $7,001.75 a tonne.
Brent crude oil rose 0.3 percent after touching its lowest levels since last July, while U.S. crude dipped 0.2 percent to $86.51. May crude futures are down more than 5 percent this week.
Gold rose 1.4 percent, on track for its third daily rise. Still, following a massive plunge on Monday, it is down more than 5 percent this week.
"Investors, who value physical gold over paper gold, have viewed these low prices as a buying opportunity," said Edmund Moy, chief strategist at gold provider Morgan Gold, adding that sales of new gold coins from the U.S. Mint had jumped in April.
In Europe's debt markets, investors shrugged off the growth worries and instead focused on the likelihood they would prompt a rate cut by the region's central bank.
The better tone allowed Spain to sell 4.7 billion euros ($6.1 billion) of new bonds at lower borrowing costs than at recent auctions as investors snapped up the high-yielding debt.
"Today's well-received auction... underscores the extent to which peripheral euro zone debt markets are almost immune from growing concerns about economic growth," said Nicholas Spiro, managing director of consultancy firm Spiro Sovereign Strategy Ltd.
German Bund futures were flat at 146.22 after the debt sale, but were supported by the expectations of loose central bank monetary policy.
Demand was boosted on Wednesday by comments from European Central Bank policymaker Jens Weidmann, who stoked a belief that interest rates could fall if economic data remains weak.