GLOBAL MARKETS-Stocks and euro pressured by German data, U.S. resultsRTRS

25-Jul-2014 21:20

• Wall Street ends lower; MSCI world index also down
• Downbeat German Ifo survey weighs on euro, European shares
• Amazon.com, Visa down after disappointing results

(Updates with U.S. market closing levels)

By Caroline Valetkevitch

NEW YORK, July 25 (Reuters) – Some disappointing U.S. earnings, including Amazon.com AMZN.O, and weak German economic data pressured world stock markets on Friday, while the euro hit an eight-month low against the U.S. dollar.

Amazon was the biggest drag on the S&P 500. Its shares sank 9.6 percent to $324.01 a day after the online retailer reported an unexpectedly big loss for the second quarter. Visa’s V.N results also disappointed and its shares ended down 3.6 percent at $214.77.

"The earnings season overall has been in line but when companies with rich valuations disappoint, you’re going to get crucified," said Lawrence Glazer, managing partner at Mayflower Advisors in Boston.

Signs emerged that tensions between the West and Russia are starting to hurt confidence in Germany, Europe’s largest economy and the driver of its recovery. Germany’s Ifo survey showed a hefty fall in business confidence over the last few weeks, prompting concerns Germany could be stuttering. (Full Story)

MSCI’s All-World Index .MIWD00000PUS was down 0.4 percent, and European stocks .FTEU3 ended 0.7 percent lower.

The Dow Jones industrial average .DJI fell 123.23 points or 0.72 percent, to 16,960.57. The S&P 500 .SPX lost 9.64 points or 0.48 percent, to 1,978.34, after closing at record highs for two straight days.

The Nasdaq Composite .IXIC dropped 22.54 points or 0.5 percent, to 4,449.56.

Goldman Sachs GS.N downgraded its global allocation to equities to neutral on a short-term basis although the brokerage remained overweight stocks for the longer term. [ID:L2N0Q0246]

Equity markets worldwide have rallied steadily through the year, with the MSCI All-World Index hitting a record high in early July. By region, Goldman is overweight in Europe and Japan and underweight in the United States.

The euro was last down 0.27 percent against the dollar at $1.3429 EUR= after falling to an eight-month low of $1.3421 on the weak German business data.

"U.S. data has been good or better than expected, whereas European data continues to point to a slowdown," said Boris Schlossberg, managing director in FX strategy at BK Asset Management in New York.

European officials are to continue talks over plans to squeeze Russia with further sanctions following the downing of a Malaysia Airlines plane that killed almost 300 people. (Full Story)

Dollar-traded Russian stocks .IRTS fell 1.6 percent. Russian bonds also fell as the country’s central bank unexpectedly raised interest rates. (Full Story)

U.S. Treasuries prices jumped, with 10-year Treasuries US10YT=RR up 11/32 to yield 2.469 percent. (Full Story)

Gold XAU= edged up as speculators bought back bearish bets ahead of the weekend. U.S. COMEX gold futures for August delivery GCQ4 settled up $12.50 at $1,303.30 an ounce.

Brent oil prices climbed as deteriorating relations between Russia and the United States fanned concerns about supply disruptions. Brent crude LCOc1 rose $1.32 to settle at $108.39 a barrel while U.S. crude CLc1 gained 2 cents to settle at $102.09.