* World stocks ease, with Dubai extending losses
* Euro off one-month lows; crude up on inventory drop
By Dominic Lau
LONDON, Dec 9 (Reuters) - Global equities slipped on
Wednesday with Japan leading the falls on concerns over the pace
of recovery, while crude oil prices recovered and the euro
picked up from a one-month low on bargain hunting.
Worries over Dubai's debt problems dampened risk appetite,
though the stock sell-off was limited outside the Gulf after
sharp losses in European and U.S. equities in the previous
session. Safe-haven government bonds were steady.
Dubai's benchmark <> fell 6.2 percent, hitting a more
than eight-month low and leading emerging market shares weaker.
The MSCI emerging equities index <.MSCIEF> lost 0.7 percent
and the MSCI All-Country World Index <.MIWD00000PUS> eased 0.3
percent, with Japan's Nikkei average <> down 1.3 percent
after a bigger-than-expected downward revision to Japanese
economic growth in the third quarter. []
In Europe, the FTSEurofirst 300 <> index was down 0.4
percent, falling for the third day in a row, and Greek bank
shares <.FTATBNK> extended recent losses, down 3.1 percent after
Fitch Ratings on Tuesday downgraded the country's sovereign
rating on fiscal deterioration. []
"There is no real reason for anyone to go back into the
market. The year-end wind down and the flattening of traders'
books started a week or so ago," said Jim Wood-Smith, head of
research at Williams de Broe.
Greece's downgrade along with Dubai's debt crisis had
weighed on the euro, but the currency <EUR=> recovered from a
one-month low on Wednesday.
The euro was up 0.2 percent at $1.4735 after a three-day of
decline against the dollar.
"While there is always the risk of another heavily-indebted
country being downgraded this year, such as Spain, Ireland or
Portugal, it looks like the euro will now stabilise at around
$1.4700," said Stuart Bennett, senior fx strategist at Calyon in
London.
The U.S. currency also fell 0.8 percent to 87.67 yen <JPY=>.
Worries about Britain's fiscal health continued to pressure
sterling, which dipped below the $1.62 mark for the first time
since mid-October ahead of finance minister Alistair Darling's
pre-budget report at 1230 GMT.
Oil prices <CLc1> recovered to above $73 a barrel, supported
by industry data showing a big drop in U.S. crude stocks and a
Saudi Arabian assurance over the strength of Gulf economies.
Gold <XAU=> edged off three-week lows as the dollar failed
to retain gains.
Yields on benchmark 10-year U.S. Treasuries <US10YT=RR> were
steady at 3.390 percent, while those on 10-year Bund <EU10YT=RR>
were down 2 basis points at 3.140 percent.
(Additional reporting by Joanne Frearson and Naomi Tajitsu in
London, editing by Mike Peacock)
