Europe woes, U.S. earnings season hit shares, euro

Tue Oct 9, 2012 4:27pm EDT
 
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By Herbert Lash

NEW YORK (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 jumped 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 view of the global economy.

The uncertain outlook for Spain and Greece added to concerns. Tens of thousands of angry Greek protesters filled the streets of Athens during a visit by German Chancellor Angela Merkel, who offered sympathy but no promise of further aid on her first visit since the euro crisis erupted three years ago.

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 Spain will ask for aid, widely seen as inevitable.

Equity investors were also in a cautious mood as they awaited the kick-off of the U.S. quarterly earnings season, which started in earnest after the market close with the release of results by aluminum maker Alcoa (AA.N: Quote).

Alcoa reported a third-quarter net loss as the price of the metal slumped and demand remained weak, but its stock rose 2.6 percent in after-hours trade.

"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.

Losses in technology shares led Wall Street lower after brokerage downgrades of Intel (INTC.O: Quote) and other major companies stoked worries about third-quarter U.S. earnings.   Continued...

 
Traders work at their desks at Frankfurt's stock exchange August 8, 2011. REUTERS/Pawel Kopczynski