* Global shares slip on doubts about economic recovery
* Euro slips vs dollar, yen as risk aversion rises
* Crude oil slides amid fears over economic outlook
(Updates with close of European markets)
By Herbert Lash
NEW YORK, Aug 17 (Reuters) - Crude oil futures and global
stock indexes fell sharply on Monday after weak economic
figures from Japan and last week's poor U.S. consumer
confidence data sparked doubts about a U.S. recovery and
prompted investors to cut their exposure to risk.
Stock markets in Asia, Europe and the United States fell
to lows last seen in July as equities tumbled 2.0 percent or
more around the world and the CBOE Volatility Index <.VIX>,
considered Wall Street's fear gauge, jumped almost 13
percent.
Oil <CLc1> slid to its lowest this month, sliding below
$66 a barrel, while gold dropped below $936 an ounce as the
U.S. dollar rose against the euro, and copper prices eased as
investors expressed caution about the demand outlook against a
weak economic backdrop.
A weaker-than-expected report from the Reuters/University
of Michigan Survey of Consumers ignited cross-market selling
late on Friday. []
Data showing Japan's economy grew between April and June
for the first time in five quarters was largely ignored, and a
surge in New York state factory activity failed to impress.
"People have started to feel that the market rally moved
well ahead of the actual economic improvement," said Vassili
Serebriakov, currency strategist at Wells Fargo in New York.
The euro hit a two-week low against the dollar and neared
a one-month trough against the yen, while U.S. and European
government debt prices rose on a flight-to-safety bid.
In Europe, the heavyweight banking sector took the most
points off the FTSEurofirst 300 <> index of top regional
shares. The index fell 2 percent to 921.96 points, its lowest
close since July 29.
"The market is too far ahead of the economy," said
Giuseppe-Guido Amato, strategist at Lang & Schwarz. "We are
not there (in recovery) yet. We have stopped the patient
bleeding, but the cancer is still there."
The sell-off in Asia was broad-based with financials,
industrials and materials providing the biggest drag on the
MSCI index of Asia Pacific shares traded outside Japan
<.MIAPJ0000PUS>. The index fell 3.7 percent to its lowest
level since late July.
U.S. stocks also fell after Lowe's Cos <LOW.N>, the No. 2
U.S. home improvement chain, curbed its expansion plans and
forecast worse-than-expected results in the third quarter as
consumers put off major expenditures. Its stock fell 9.4
percent.
Other corporate news also reinforced the belief that
consumers, the cornerstone of the U.S. economy, are still in
economic straits.
Bank of America Corp <BAC.N>, the largest U.S. bank, and
Capital One Financial <COF.N> reported credit card defaults
rose in July.
"The rebound in the S&P has been its fastest in the
post-war (period), and so people are getting nervous that
things have come too far, too fast," said Rob Minikin, senior
currency strategist at Standard Chartered in London.
The Dow Jones industrial average <> fell 158.48
points, or 1.70 percent, to 9,157.78. The Standard & Poor's
500 Index <.SPX> dropped 21.71 points, or 2.16 percent, to
982.38. The Nasdaq Composite Index <> lost 49.88 points,
or 2.51 percent, to 1,935.64.
The benchmark 10-year U.S. Treasury note <US10YT=RR> was
trading 24/32 higher in price to yield 3.49 percent.
The euro was down about 0.9 percent at $1.4077 <EUR=>,
just above a two-week low. It was down about 1.2 percent at
132.80 yen <EURJPY=> after hitting its lowest level since July
22. Against the yen, the dollar fell about 0.6 percent to
94.35 yen <JPY=>.
U.S. crude oil futures for September delivery fell $1.81
to $65.70 a barrel.
(Reporting by Steven C. Johnson, Chris Reese in New York;
Alex Lawler, Atul Prakash and Tricia Wright in London; Writing
by Herbert Lash; Editing by Jan Paschal)
