World stocks wobble at pre-Wall St open

Wall Street set for losses after huge run up on Tuesday

Dollar falls,bond prices rise

China exports data helps boost sentiment

Fed move reflects gloomy outlook,say analysts

European stocks fell 0.7 percent on renewed concerns about bank exposure to euro zone debt,and as U.S. stock index futures fell.

The turnaround overshadowed a morning of gains in Europe and Asia prompted by the Fed8217;s dovish announcement on Tuesday.

Investors were also lifted earlier by data showing China8217;s export growth accelerating in July,calming fears that weak demand from Europe and the United States would hit the world8217;s second-biggest economy.

The MSCI all-country world index ,which has fallen as much as 20 percent from a May high,was up half a percent and emerging market shares gained 1.8 percent. Both were off their highs.

The Fed8217;s unprecedented commitment to keep rates extraordinarily low until 2013 was double-edged. It sent the message to markets that the Fed is willing to keep things afloat,but it also acknowledges how much the U.S. economy has weakened.

Low interest rates support equity markets,but it is just a relief rally. There are too many uncertainties out there,Louise Cooper,markets analyst at BGC Partners,said.

Markets are so badly beaten up any piece of good news is an excuse to rally. Yes,markets do look cheap,however,we could have years and years of low growth to pay back our debts.

Goldman Sachs said a third round of asset-buying quantitative easing from the U.S. central bank was likely.

We now see a greater-than-even chance that it will resume quantitative easing later this year or in early 2012. We have changed our call because the statement suggests that the committee8217;s reaction function to incoming economic news is more dovish than we had previously thought,Jan Hatzius,chief economist at the firm,said in a note.

DOLLAR FALLS,EURO VULNERABLE

The dollar fell 0.4 percent against major currencies as prospects for minimal dollar-interest rates sent buyers elsewhere.

The euro also fell on concerns about the euro zone8217;s now broad-based debt crisis,despite the European Central Bank8217;s move to ease some of the pressure by buying peripheral debt.

Switzerland8217;s central bank,meanwhile,said it was expanding measures to fight against the Swiss franc8217;s strength. Investors have been pouring into the currency as a safe haven during recent market and economic weakness.

Gold and oil rebounded after the Fed8217;s announcement,making up ground after falls the previous session.

German government bonds climbed,tracking moves in U.S. Treasuries overnight after the Fed8217;s move.

There8217;s a fear that the outlook is very bad if they8217;re committing until 2013,a bond trader said.