* World shares fall after IMF forecasts weaker growth
* Oil jumps on supply concerns as Middle East tension mounts
* Uncertainty over Spain and Greece pressures euro
By Herbert Lash
NEW YORK, Oct 9 (Reuters) – Global equities and the euro
fell on Tuesday on concerns over the U.S. earnings outlook and a
stark warning from the IMF about global growth, while oil rose
on escalating tensions in the Middle East.
Government debt prices rose in a bid for safety as anxiety
among investors picked up on the International Monetary Fund’s
gloomier picture of the global economy. The uncertain outlook
for Spain and Greece added to concerns.
Equity investors were also in a cautious mood as they
awaited the kickoff of the quarterly earnings season, due to
start in earnest after the market close with the release of
results by aluminum maker Alcoa.
“The tone of the market still feels greatly uncertain as we
head into earnings season in the United States, and indeed the
market is now focusing its attention that way as it seeks out
bad news wherever it can find it,” said Brad Bechtel, managing
director at Faros Trading in Stamford, Connecticut.
Disappointing results could weigh on equity prices and the
euro. Stocks and the euro move together 90 percent of the time,
Reuters data showed, with the euro rising as stocks gain.
The Dow Jones industrial average was down 82.31
points, or 0.61 percent, at 13,501.34. The Standard & Poor’s 500
Index was down 11.29 points, or 0.78 percent, at
1,444.59. The Nasdaq Composite Index was down 45.46
points, or 1.46 percent, at 3,066.89.
In Europe, the FTSEurofirst 300 index of top
company shares fell 0.4 percent to 1,097.18 points, while MSCI’s
all-country world equity index slid 0.6 percent.
The benchmark 10-year U.S. Treasury note was up
6/32 in price to yield 1.7115 percent.
The euro fell 0.5 percent to $1.2902. The U.S. Dollar
Index rose 0.43 percent at 79.881.
Spanish bond yields rose after euro zone finance ministers
said on Monday that Madrid did not need a bailout yet, adding to
uncertainty about when the country will ask for aid, something
widely seen as inevitable.
Concern about Greece also resurfaced after European Central
Bank chief Mario Draghi told the European Parliament Committee
that Greece has made progress on reforming its economy, but has
more work to do.
“Some things have improved in the last to two or three
months, but I think the road ahead is still long and it’s
uphill,” Draghi said.
The IMF, one of Greece’s main lenders, said in a report
that Athens would miss the five-year debt reduction target that
is a condition for the country’s 130 billion euro bailout.
Oil rose as fears Syria’s civil war could drag in neighbors
reinforced existing concerns about supply security from the
ongoing dispute between Iran, Israel and the West over Tehran’s
nuclear program.
Brent futures rose $1.44 to $113.26 a barrel. U.S.
crude climbed $1.40 to $90.73, also rebounding after two
consecutive sessions of declines.
Copper prices steadied on expectations for further
pro-growth policies from top consumer China, but later slipped
as risk assets sold off.
Benchmark copper on the London Metal Exchange was
down 0.2 percent at $8,165 a tonne.
