* MSCI World index down 0.7 pct, European index down 1.4 pct
* Thursday's sharp sell-off on Wall Street takes global toll
* All three major Wall Street indexes fall
* Bonds rise on safety bid
(Updates with Wall Street stocks lower, changes prices)
By Herbert Lash
NEW YORK, April 11 Global equity markets fell on
Friday as fears on Wall Street about over-stretched stock
valuations spread to Asia and Europe, pushing investors to the
safety of bonds.
The Nasdaq composite, which has been pounded in recent days
as investors bailed out of high-flying technology and
biotechnology shares, slipped again on Friday. The index on
Thursday recorded its biggest drop in two-and-a-half years.
The benchmark S&P 500 index was also lower and was on target
for its worst week since January. The Nasdaq biotech index
, after falling more than 20 percent from a recent high,
rose 0.4 percent.
Benchmark 10-year Treasuries notes were tracking
the losses in stocks. With equities lower, the 10-year bond rose
8/32 in price to yield 2.627 percent.
"This equity market meltdown has brought a 'fear' bid into
bonds," said Larry Milstein, head of government and agency
trading at R.W. Pressprich & Co. in New York.
A benchmark of global equities fell to a two-week low,
spurred by a broad risk-averse tenor among investors that led to
sell-offs in higher-yielding currencies and emerging market
"There's been contagion from the correction in the U.S.
which is probably not over. But the fact is, this is mostly a
U.S. correction," said David Thebault, head of quantitative
sales trading at Global Equities in Paris.
"People are getting out of overvalued sectors and looking
for bargains elsewhere. The market's positive longer-term trend
is still intact, this pull-back will just remove the froth," he
The slide in global equities persisted in the wake of
disappointing quarterly results from JPMorgan Chase & Co.
, the biggest U.S. bank. This exerted more pressure on
the benchmark Standard & Poor's 500 index, which on
Thursday suffered its biggest one-day drop in two months.
Shares of JPMorgan sank 3.1 percent to $55.63, and the S&P
financial index lost 0.6 percent and was the worst
performing S&P sector.
MSCI's all-country world equity index fell
to lows last seen in late March and was last trading down 0.7
European technology stocks led sectoral falls with a
2.5 percent decline, echoing U.S. declines. The tech sector in
Europe had rallied more 40 percent since November 2012 through
the start of April.
The pan-European FTSEurofirst 300 of leading
regional shares closed down 1.4 percent at 1,312.92.
The Dow Jones industrial average fell 85.64 points or
0.53 percent, to 16,084.58, the S&P 500 lost 7.99 points,
or 0.44 percent, to 1,825.09, and the Nasdaq Composite
dropped 20.664 points, or 0.51 percent, to 4,033.443.
The dollar index, which measures the greenback against six
major currencies, rose 0.04 percent, and the dollar edged higher
against the yen, up 0.11 percent. The euro rose slightly against
"Bad news for the world is good news for the dollar," said
Steven Englander, managing director and global head of G10 FX
strategy at CitiFX in New York. "Once fears about the equity
market intensified, they picked up a more conventional type of
mode to buy the dollar."
Brent oil futures gained slightly. Brent crude was
up 16 cents at $107.62 a barrel. U.S. oil was up 77 cents
at $104.16 a barrel.
(Reporting by Herbert Lash; Additional reporting by Atul
Prakash in London; Editing by Leslie Adler)