Global Stocks Slip Amid Economic Worries

Global stocks dipped on Thursday after disappointing U.S. data tempered the outlook for the world's biggest economy while the price of oil stabilized following some sharp losses.

In Europe, shares fell for a third straight day and investors were awaiting an Italian bond auction which would provide the latest test of sentiment on the euro zone's ability to overcome its debt crisis.

Brent crude was steady near $124 a barrel after falling more than 1 percent on Wednesday on a surge in U.S. crude inventories and on talks between Western nations on releasing strategic oil reserves in a bid to stop fuel prices choking economic growth. Brent crude has gained more than 15 percent this quarter.

"Markets moved to take risk off yesterday, not just in commodities but across most financial markets," said Nick Trevethan, a senior commodity strategist at ANZ in Singapore. "We saw reductions in oil, in part perhaps because of talks to release strategic reserves by the United States and others. That taken with the uninspiring U.S. data has encouraged people to take risk off."

Reduced risk appetite supported the yen against the dollar although traders said the Japanese currency would soon come under renewed pressure as buying linked to the end of the Japanese financial year would peter out.

New orders for long-lasting U.S. factory goods increased only modestly in February, supporting the view that U.S. economic growth in the first quarter could be lacklustre.

MSCI's main global stock index, which hit an eight-month high earlier this week, was down 0.2 percent.

Profit taking ahead of the end of the first quarter has added to the pullback in stocks in the past few days but analysts said that should be waning.

Shares in French oil company Total remained under pressure on the Paris stock market following a gas leak in the North Sea and were down nearly 1 percent.

Shares in Tokyo, which hit a one-year high on Tuesday, slipped 0.9 percent, but still looked set for their best January-March quarter in 24 years.

Markets are likely to continue to suffer sharp swings in risk appetite on mixed economic data from the United States and China and continuing concerns about the euro zone's debt problems and its economic outlook.

Access to credit continues to weigh on European economies. Data on Wednesday showed banks cut lending to euro zone companies in February, suggesting the flood of cash pumped out by the European Central Bank since last year has yet to bolster flagging businesses in the wider economy.

European Union finance ministers will seek on Friday to calm some of investors' worst fears by discussing how to strengthen the euro zone's defences against the spread of the debt crisis, but lasting relief in the market was unlikely.

"Most of this good news already seems to be in the price and investors may need to see much better macro data to revive the upward momentum in risk assets," Lloyds Bank strategists said in a note.

Commodities have been knocked by worries that China's economy could be headed for a hard landing. Those fears rattled China's stock markets on Thursday and sent the Australian dollar down 0.6 percent against the safe-haven yen although some analysts said those fears were being overplayed.

"With the Chinese stock markets under pressure, the outlook on AUD will unlikely turnaround until we see some confirmation that the Chinese economy is not weakening too much and which should be affirmed by the release of the Chinese PMI (on Sunday)," said analysts at BNP Paribas.

Copper, which has rallied 10 percent this year, was steady after shedding more than 2 percent on Wednesday. Three-month copper was trading at $8,347 a tonne in early London trade. It has struggled to make headway above the $8,700 mark because of slack demand from top consumer China.