* Stock slip ahead of raft of U.S. earnings
* Sterling rises against euro, dollar on Kraft-Cadbury deal
By Jeremy Gaunt, European Investment Correspondent
LONDON, Jan 19 (Reuters) - World stocks slipped on Tuesday
as investors waited for a wave of U.S. company earnings reports
to give them a steer of how well the micro side of the global
economic recovery is faring.
On currency markets, Britain's pound hit a six-week high
against the dollar, drawing strength from U.S.-based Kraft Foods
<KFT.N> nearing a recommended deal to buy Britain's Cadbury
<CBRY.L> for around 11.7 billion pounds ($19.2 billion).
[]
U.S. markets were returning from their Martin Luther King
holiday to face myriad earnings reports over the next few days.
Citigroup <C.N> and IBM <IBM.N> are set to announce results
on Tuesday, while Bank of America <BAC.N> and Morgan Stanley
<MS.N> numbers are due on Wednesday. American Express <AXP.N>,
Goldman Sachs <GS.N> and Google <GOOG.O> results are expected on
Thursday and General Electric <GE.N> figures are due on Friday.
MSCI's all-country world stock index <MIWD00000PUS> was down
around 0.2 percent By 0850 GMT. Europe's pan-European
FTSEurofirst 300 <> dropped 0.5 percent.
Earlier, Japan's Nikkei <> closed down 0.8 percent.
"Results from IBM and Citigroup could give both the bulls
and the bears plenty of ammunition to move markets. The sheer
number of companies reporting this week could make this a
pivotal period," said Owen Ireland, analyst at ODL Securities.
The U.S. earnings season has disappointed equity investors
so far, perhaps because year-on-year expectations were so high
given the weakness of Q4 2008.
Markets, for example, were negative last week on JPMorgan
<JPM.N>, the first major bank to report quarterly results,
because of heavy losses on mortgage and credit card loans.
This was despite its quarterly profit soaring to $3.3
billion, topping Wall Street expectations.
WEAKER DOLLAR
The dollar fell 0.2 percent to 90.55 yen <JPY=> to a
four-week low. Japan Airlines Corp <9205.T> said on Tuesday it
had filed for bankruptcy with 2.3 trillion yen ($25.4 billion)
in debt as of the end of September.
The euro fell to a four-month low against the pound
<EURGBP=> as Greece's fiscal woes continued to take a toll on
the single European currency and the Kraft-Cadbury deal boosted
sterling.
At a meeting of euro zone finance ministers on Monday,
Greece received the group's backing to tackle its debt troubles,
even as they pressed the country to do more on its own.
Greece's ballooning budget deficit and debt of more than 120
percent of GDP has triggered downgrades by debt rating agencies
and hurt the euro in the past few months.
Euro zone government bond futures extended gains to fresh
1-month highs as regional stocks dipped, and U.S. Treasuries
nudged higher after the long U.S. holiday weekend.
(Additional reporting by Atul Prakash, editing by Mike Peacock)
