* Stocks, oil and dollar all fall
* Corporate earnings in focus, Morgan Stanley, Boeing due
* Emerging market sentiment hit by Brazil tax
By Jeremy Gaunt, European Investment Correspondent
LONDON, Oct 21 (Reuters) - Recent trading patterns broke at
least temporarily on Wednesday with both the dollar and world
stocks slipping, the latter weakened particularly by falling
emerging markets.
Crude oil <CLc1> dropped as well, sitting below $79 a barrel
and pulling further away from its recent one-year peak. Despite
this, the day's gainers were to be found in gold and copper.
The dollar has traded inversely to both oil and equities for
much of this year.
Emerging market stocks were underperforming with MSCI's
benchmark index <.MSCIEF> down around three-quarters of a
percent compared with slight losses for global equities as a
whole.
Brazilian Finance Minister Guido Mantega announced on Monday
that his government would charge a 2 percent financial
transactions tax on foreign investments in Brazilian stocks and
fixed-income securities in a bid to prevent the country's
currency from strengthening further.
This hit Brazilian assets but also triggered some concern
among emerging market investors that the idea may spread among
other countries concerned about the degree of "hot money"
flowing into their markets.
Europe's FTSEurofirst 300 <> reversed earlier gains to
stand 0.2 percent lower. It remained close to a 12-month high,
however.
The focus was on what have been generally upbeat earnings
results. Morgan Stanley <MS.N> and Boeing <BA.N> were to report
later in the day.
Analysts said investors remained cautious following the
market's inability to post convincing gains in the past few
days.
"We are entering an intense period -- whilst over the longer
term, the bulls have clearly taken the lead, the short term
appears to be a little more cloudy," said John Murphy, analyst
at ODL Securities.
WEAK DOLLAR
The dollar fell against a basket of major currencies <.DXY>
heading for its 10th loss in 15 trading days this month. The
index has also been in the red for seven of the past eight
months.
Sentiment towards the currency continues to be hurt by the
prospect of U.S. interest rates staying at exceptionally low
levels for longer than most other currencies.
The New Zealand dollar shone meanwhile after New Zealand's
central bank chief Alan Bollard said a high currency was not
necessarily an obstacle to raising the cash rate.
[]
The euro rose 0.1 percent against the dollar compared with
late New York trade at $1.4944 <EUR=>, having hit a 14-month
high of $1.4994 the day before.
Euro zone government bond yields were flat to higher, with
the 10-year Bund <EU10YT=RR> yielding 3.266 percent.
(Additional reporting by Atul Prakash, editing by Mike Peacock)
