Signs the global economic slowdown may be worsening sent world share markets and oil lower on Wednesday, while the euro held steady against the dollar as investors waited for Spain to take the steps to trigger European Central Bank intervention.
The latest data from surveys of purchasing managers' activity across the euro zone and China showed the growth outlook has not improved, despite the best efforts of central banks to stimulate their economies.
"There's little to be cheerful about," said Filip Petersson, analyst at SEB in Stockholm. "There's worry about whether Spain will ask for a bailout or not, and there's major uncertainty around China."
The gloomier economic data, including weak export numbers from resource-rich Australia, sent Asian markets lower <.MIAPJ0000PUS> and saw the FTSEurofirst 300 index <.FTEU3> of top European shares slip 0.1 percent to 1,100.83 points.
U.S. stocks were poised for a flat open on Wall Street, with attention on the September ISM purchasing managers' report, which should point to better growth.
MSCI's world equity index <.MIWD00000PUS> was down 0.16 percent at 332.97, though it remains in positive territory for October, which would be its fifth straight monthly rise.
Crude oil prices and commodities like copper were hit as the weaker data dimmed the outlook for demand.
Brent November crude futures fell $1 to $110.57 a barrel, while U.S. November crude shed 60 cents to $91.30 a barrel.
Three-month copper on the London Metal Exchange had eased 0.5 percent to $8,283.00 a metric tonne, after climbing more than 2 percent over the past four sessions.
A fresh update on the September euro zone purchasing managers' survey indicated it was almost inevitable now that the region will slip into its second recession in three years during the September quarter.
The Markit Euro zone Composite PMI fell to 46.1 in September from 46.3 in August. Any reading below 50 indicates economic contraction.
"We are heading towards a 0.2 percent contraction in the third quarter and a mild 0.1 percent contraction in the fourth quarter," said Evelyn Hermann, a European economist at BNP Paribas in London.
Last month the European Central Bank sought to calm market nerves and respond to the growing impact from the debt crisis on business by promising to buy bonds issued by governments that requested help if they agreed to tough economic reforms.
As yet no government has sought the ECB's assistance, though the markets expect Spain, which faces huge refinancing needs this month, to be the first. But uncertainty over when it will ask for the help is keeping investors on edge.
Spanish Prime Minister Mariano Rajoy dashed hopes that an announcement was in the works when he told regional government leaders on Tuesday that it was not imminent.
Since the request, when it comes, will likely spark big demand for the euro, investors opted to wait, leaving the single currency virtually unchanged against the dollar at $1.2920, above the three-week low of $1.2803 hit on Monday.
"There's a little bit of doubt with respect to Spain, but it's more or less inevitable they will request financial assistance at some stage," said Peter Kinsella, currency strategist at Commerzbank.
The delay implied by Rajoy's latest comments lifted demand for safe-haven German government bonds, sending 10-year yields down two basis points to 1.44 percent.
Ten-year Spanish government bond yields were little changed at 5.76 percent, while two-year borrowing costs rose slightly to 3.24 percent.
"A lot of the improvement we had seen in Spanish bonds yesterday was driven by overnight speculation that a bailout was imminent, so any rebuttal of that had an impact," said Brian Barry, fixed income analyst at Investec.
Activity in most markets was also being curtailed by caution ahead of the European Central Bank's monthly monetary policy meeting and a Spanish debt auction on Thursday, and by a U.S. jobs report due out on Friday.
"All eyes at the moment are on non-farm payrolls on Friday. If we get a reasonably good number, that will be 'risk-on' across the board, and the euro will grind higher," Commerzbank's Kinsella said.
(Additional reporting by Markets await Spain's next move on bailout request, Ana Nicolaci da Costa and Nia Williams; Editing by Will Waterman)