Global shares retreat on world growth fears, but oil rises
By Herbert Lash
NEW YORK (Reuters) - Global shares fell for a third day on Wednesday as corporate warnings of slower growth underscored concerns about a sluggish world economy, while oil prices rebounded over worries about the security of Middle East crude supplies.
Weak risk sentiment hurt equity markets after warnings from the International Monetary Fund, the World Bank and U.S. multinationals about the lackluster world economic outlook.
After the close of trading on Tuesday, Alcoa warned of dwindling aluminum consumption, while other large companies, including Dow component Chevron (CVX.N: Quote) and engine maker Cummins Inc (CMI.N: Quote), cautioned about slowing growth.
"You've seen very cautionary earnings results and even forward guidance; Alcoa has good earnings, but their forward guidance is lackluster," said Richard Weeks, managing director at HighTower Advisors in Vienna, Virginia. "It points to a slow China and slow global growth."
The Dow Jones industrial average .DJI was down 72.97 points, or 0.54 percent, at 13,400.56. The Standard & Poor's 500 Index .SPX was down 4.33 points, or 0.30 percent, at 1,437.15. The Nasdaq Composite Index .IXIC was down 4.56 points, or 0.15 percent, at 3,060.46.
Ebbing growth in China, the world's No. 2 economy, is expected to rein in corporate earnings in the third quarter and dent profit forecasts as the Asian nation feels the pinch of the debt crisis in the euro zone, a key trading partner.
The World Bank cut its growth forecast for East Asia earlier in the week on concerns China's slowdown could last longer than expected.
On Tuesday, the International Monetary Fund said a deepening euro zone debt crisis threatened the global economy. Continued...