GLOBAL MARKETS-Republican gains push dollar to 7-year high versus yen

* Republicans take majority of seats in U.S. Senate

* U.S. stock futures rise, European shares jump 1.4 percent

* Crude prices fall further after China PMI data

* Gold at four-year low

By Marc Jones

LONDON, Nov 5 (Reuters) - Sweeping Republican party wins in

U.S. mid-term elections pushed the dollar to a seven-year high

against the yen and lifted U.S. stock futures on Wednesday. More

soft data from China left oil at its lowest in four years.

Republicans rode a wave of voter discontent to secure

control of the U.S. Senate and strengthen their grip on the

House of Representatives in a punishing blow to President Barack

Obama that will limit his power in his last two years in office.

Financial markets saw the election results as a cause for

optimism. Similar situations in the past have often sparked U.S.

stock market rallies.

Futures prices pointed to a 0.5 percent gain for Wall

Street when trading opens, while the dollar reached as high as

114.59 yen, its highest since December 2007.

"We all saw this result coming, but the main thing is what

the two sides decide, whether they want to co-operate and

compromise or whether they are going to go back to the

trenches," said Philip Marey, a U.S.-focused economist at

Rabobank.

"They (Republicans) have the incentive to be constructive to

show to voters that they can rule the country ... If they manage

to cooperate it could boost the economy, especially if things

can be done on areas like infrastructure."

U.S. markets were also preparing for ADP employment and

non-manufacturing ISM data due shortly. Both should set

the tone for Friday's closely followed non-farm payrolls jobs

report.

Europe's main stock markets had advanced through

the day, rising almost 1.5 percent. Encouraging company earnings

from Britain to Sweden helped the region to overlook downbeat

economic data from both Europe and China.

Growth in China's services sector weakened further in

October as new business cooled, reinforcing signs of a gradual

economic slowdown that could prod the government to unveil fresh

stimulus measures.

In the euro zone, business growth picked up less than

expected despite much deeper price cutting by companies. Retail

sales were also weak and even high-flying neighbour Britain saw

its dominant services sector slow.

DOLLAR REBOUNDS

The Chinese data was the latest blow for commodities. Brent

oil fell towards $80 a barrel as demand worries

mounted.

Copper, a metal whose price is linked to growth, hit

its lowest in a fortnight. Gold slid to a four-year low

below $1,150 an ounce as a strong dollar kept investors away.

"The market is already soft for Brent, and the Chinese data

is not going to help although the numbers are not a surprise,"

said Avtar Sandu, senior manager for commodities at Phillip

Futures.

The disappointing data from the euro zone also meant the

euro's struggles continued, a day before the European Central

Bank's monthly meeting. The single currency hit a two-year low

against the Swiss franc and slid back below $1.25.

Sterling also wilted.

One reason was betting that feeble euro zone growth and

inflation would prompt more action from the ECB in the coming

months. Another was uncertainty after Reuters reported that ECB

President Mario Draghi's leadership style was upsetting some of

the national central banks.

"We do not expect further easing at Thursday's ECB meeting,

but it may give more insight into its new asset-purchase

programmes," strategists at Barclays (LSE: BARC.L - news) said.

With the dollar soaring at a fresh seven-year peak and

buying 114.74 yen, yields on benchmark 10-year U.S.

Treasury notes rose to 2.346 percent. European bond

markets had a largely quiet day before the ECB meeting.

RUSSIA RUMBLES

Russia's rouble hit an all-time low as the country's

central bank finally succumbed to this year's heavy pressure on

the currency, which has cost it almost $75 billion in reserves.

After a big rate hike last week had failed to ease the

strains, the central bank said on Wednesday it would massively

scale down its currency market intervention. That means the

rouble's level will now largely be determined by the market.

The drop in the price of oil, which is Russia's biggest

revenue earner, remained the main source of pressure. Signs of

tensions flaring again in Ukraine added to the strain.

Separatist leaders in eastern Ukraine accused President

Petro Poroshenko of violating a peace deal by suspending a law

giving their regions a "special status".

Russia meanwhile test-fired an intercontinental missile from

a submarine in the Barents Sea a day after both Moscow and Kiev

moved troops closer to their joint border.

"The central bank of Russia has finally done it," Dmitry

Polevoy, the chief Russia economist at ING Bank in Moscow, said

after the change in FX intervention. "The rouble has de facto

become a fully flexible currency."

(Editing by Susan Fenton, Larry King)