GLOBAL MARKETS-Stocks, euro, oil fall on Spain downgrade, China

                                
  
                                
 * Spain's ratings downgrade drives stocks, euro down
                                
 * China's unexpected trade deficit fuels growth worries
                                
 * Brent crude falls below $115 a barrel
                                
 * Rising US jobless claims weigh on sentiment
 (Updates with U.S. markets, adds byline, dateline)
                                
 By Walter Brandimarte and Blaise Robinson
                                
 NEW YORK/PARIS, March 10 (Reuters) - World stocks and the
euro fell on Thursday as a downgrade of Spain's credit added to
worries over the euro zone debt crisis, while an unexpected
Chinese trade deficit fueled global growth concerns.
                                
 Brent oil prices <LCOc1> dipped below $115 a barrel on data
showing China posted in February its largest trade deficit in
seven years. The country's exports, a gauge of global economic
activity, suffered a larger-than-expected impact from the Lunar
New Year holiday. For details, see [ID:nTOE72903F]
                                
 Copper prices also fell on data showing China's imports of
commodities declined. The retreat in oil prices was limited,
however, as forces loyal to Libyan leader Muammar Gaddafi
assaulted the eastern oil town of Ras Lanuf, sparking worries
about damage to the oil infrastructure. [ID:nLDE72900H]
                                
 U.S. stocks opened with sharp losses as
higher-than-expected claims of unemployment benefits in the
United States added to the economic concerns.
                                
 "Overseas issues continue to play a role in U.S. markets.
The situation in Europe isn't complete, the market continues to
have concerns about sovereign credit," said Subodh Kumar, chief
investment strategist at Subodh Kumar & Associates in Toronto.
                                
 "Markets have been hoping that China would lead the
recovery, but when you put this (U.S.) data with slower growth
out of China, the idea that everything looks normal is going
away."
                                
 China exports grew in February from a year earlier well
short of forecasts.
                                
 The Dow Jones industrial average <.DJI> fell 177.59 points,
or 1.45 percent, to 12,035.50, while the Standard & Poor's 500
Index <.SPX> lost 19.91 points, or 1.51 percent, to 1,300.11.
The Nasdaq Composite Index <.IXIC> declined 44.12 points, or
1.60 percent, to 2,707.60.
                                
 In Europe, the FTSEurofirst 300 <.FTEU3> index of top
shares fell 1.2 percent. Global stocks measures by MSCI's
All-Country World Index <.MIWD00000PUS> slid 1.7 percent.
                                
 SPAIN DOWNGRADED
                                
 The euro <EUR=> fell 0.56 percent to $1.3829 after Moody's
downgraded Spain to Aa2 from Aa1, warning of further cuts to
the country's credit ratings. [ID:nWLA4974]
                                
 The move comes a few days after Moody's downgraded Greece
by three notches, fueling negative sentiment towards struggling
euro zone sovereign borrowers on the eve of a summit of the
currency bloc. [ID:nLDE7290IP]
                                
 "If speculators really hit Portugal hard there would appear
to be an increased possibility that Spain will be put back
under the spotlight, but we don't think Spain will need to be
bailed out," said Jane Foley, senior currency strategist at
Rabobank.
                                
 Increased aversion to risk pushed investors into the
perceived safety of U.S. government bonds. Benchmark 10-year
Treasury notes <US10YT=RR> were up 8/32 in price, with the
yield at 3.4396 percent.
 (Additional reporting by Chuck Mikolajczak in New York and
Neal Armstrong in London; Editing by Kenneth Barry)