US stocks turned lower on Wednesday after more companies showed the depth of the recession offsetting a few bright spots in economic news that bolstered the US dollar earlier in the day. The US dollar rose against the yen after data showed the US services sector was not contracting as quickly as thought. The euro's decline began earlier with news of a downgrade in Russian sovereign debt. The dismal economic news and bleak outlook from companies such as Kraft, that had been expected to hold up well in a downturn, soured investor sentiment and sent stocks lower. As the market closed, Microsoft Chairman Bill Gates said that the US economy has three or four “very tough” years ahead. The Dow Jones industrial average fell 121.70 points, or 1.51 percent, at 7,956.66. The S and P 500 Index slipped 6.30 points, or 0.75 percent, at 832.21. The Nasdaq Composite Index shed 1.25 points, or 0.08 percent, at 1,515.05. The FTSEurofirst 300 index of top European shares rose 2.5 percent to close at 811.41 points. The euro fell 1.47 percent at $1.2844. The sell-off reflects some unwinding of safe-haven bonds and other low-risk assets, in addition to anxiety about the prospect for long-term inflation due to surging debt supply. The benchmark 10-year U.S. Treasury note fell 10/32 in price to yield 2.92 percent. The 2-year U.S. Treasury note fell 2/32 in price to yield 0.99 percent. Gold climbed above $900 an ounce on economic worries. Overnight in Asia, the MSCI index of Asia-Pacific stocks outside Japan rose 0.9 percent, while Japan's Nikkei average rose 2.7 percent.
