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GLOBAL MARKETS-Stocks fall, yen jumps after China rout

* Chinese shares plunge again despite Beijing's support

* U.S. stocks down 1 pct in early trading

* Yen buoyed by safe-haven buying as risk sentiment fades

* Euro zone sets end-of-week deadline for Greece

* Fed minutes due (Updates with U.S. market openings, changes byline, dateline, previous LONDON)

By Caroline Valetkevitch

NEW YORK, July 8 (Reuters) - World markets were shaken on Wednesday by a crash in Chinese stocks and concerns after euro zone leaders set an end-of-week deadline for Greece to produce proposals to secure a loan deal, while commodities prices stabilized.

U.S. stocks were down 1 percent in early trading after a 6.75 percent plunge in China shares overnight. Securities regulators there warned investors were being gripped by "panic sentiment."

The yen rose to a six-week high against the dollar as investors sought safe-haven assets. Benchmark copper on the London Metal Exchange was up 3 percent after earlier hitting a six-year low of $5,240 a tonne on worries about demand in top consumer China.

More than 30 percent has been knocked off the value of Chinese shares since mid-June, and investors are worried China's market turmoil could destabilize the global economy.

"Greece and China have been at the forefront of investors' minds right now, although China is the bigger factor simply because of its size and its role as a global market player," said Ninh Chung, head of investment strategy and portfolio management at SVB Asset Management in San Francisco.

Minutes from the most recent Federal Reserve meeting also were on tap for U.S. markets.

MSCI's all-country equities world index lost 0.8 percent, while the Dow Jones industrial average fell 179.48 points, or 1.01 percent, to 17,597.43.

The S&P 500 lost 20.61 points, or 0.99 percent, to 2,060.73 and the Nasdaq Composite dropped 58.00 points, or 1.16 percent, to 4,939.46.

In Asia, Hong Kong shares dropped 8 percent, and Japan's Nikkei and stocks in Australia took heavy blows, leaving investors only the yen and safe-haven government bonds for refuge. The yen rose to a six-week high against the dollar.

European shares were up 0.1 percent and looked on course earlier to snap a four-day losing streak.

In addition to China, eyes are still also on Greece, which made a formal request for a three-year loan deal from the euro zone rescue fund.

The bloc's leaders on Tuesday gave Athens until the end of the week to come up with proposals for reforms in return for loans. Without the aid, Greece is likely to crash out of Europe's single currency.

Against the dollar, the euro was up 0.4 percent at $1.1053 , while the yen gained as much as 1 percent versus the greenback to 121.31, its strongest since late May.


Commodity markets, highly exposed to China, were slowly starting to regain their footing.

Oil prices pulled out of their dive, with U.S. crude up 25 cents at $52.58 a barrel and Brent up 74 cents at $57.59. This week is shaping up to be the worst for crude since March.

The selloff in metals markets also eased. Spot gold was up 0.2 percent at $1,157.22 an ounce. It earlier had slid to a four-month low of just below $1,150 an ounce.

Beijing's steps to stabilize its turbulent markets in recent weeks have had little success. More than 500 China-listed companies announced trading halts on the Shanghai and Shenzhen Exchange on Wednesday, taking suspensions to about 1,300, or 45 percent of the market. The yuan touched a four-month low in the offshore market.

The Australian dollar, often used as a liquid proxy for China plays, slumped to a six-year low against the U.S. dollar of $0.7389.

In the bond market, the yield on the 10-year U.S. Treasury note last stood at 2.233 percent, just above its U.S. close of 2.231 percent on Tuesday, when it had also dropped to a five-week low of 2.185 percent.

(Additional reporting by Marc Jones in London and Gertrude Chavez-Dreyfuss in New York; Editing by Ruth Pitchford and Meredith Mazzilli)