Asia shares fall as economy gloom hits techs, miners

Nikkei down to two-month low on concerns that upcoming corporate earnings for latest quarter would be hurt by sluggish global growth

Asian shares fell on Wednesday, led by losses in technology and materials stocks after brokerage downgrades for top chip maker Intel Corp and a warning from global miner Rio Tinto about the uncertain near-term outlook.

Global equities and the euro had fallen on Tuesday, knocked by gloomy forecasts from the International Monetary Fund, which said the world economic slowdown was worsening, and pessimism about the U.S. corporate earnings outlook.

The safe-haven dollar rose on Wednesday as the euro zone's festering debt crisis put the single currency under renewed pressure. Spanish bond yields climbed on Tuesday as Madrid kept markets guessing over whether it will request an international bailout.

MSCI's broadest index of Asia Pacific shares outside Japan fell 0.4 percent, with the materials and tech sub-indexes both shedding more than 0.5 percent.

Japan's Nikkei average fell to a two-month low on Wednesday on concerns that upcoming corporate earnings for the latest quarter would be hurt by sluggish global growth, as the IMF cut its forecasts for the second time since April.

SmartEstimates from Thomson Reuters StarMine expects average negative earnings surprises of 1.2 percent for the July-September quarter's results.

By the midday break, the Nikkei shed 1.7 percent to 8,621.06 after falling 1.1 percent on Tuesday.

U.S. stocks fell around 1 percent on Tuesday. Shares of Intel, the world's largest semiconductor maker, lost 2.7 percent after negative reports from at least two brokerages.

Equity markets have broadly been rallying since hitting a nadir for the year in early June, supported by a fresh round of stimulus measures rolled out by major central banks last month to bolster fragile economies.

But caution has set in as the corporate third quarter results season gets under way, with S&P 500 earnings forecast to have fallen 2.4 percent from the year-earlier period, the first decline in three years, according to Thomson Reuters data.

"History is not on the side of those who expect the market to continue to prosper once the earnings cycle has turned," said John Higgins, senior markets economist at Capital Economics, in a note.

Reinforcing nervousness about the state of the global economy, Rio Tinto Chief Executive Tom Albanese said on Tuesday the company would step up cost cuts because of an uncertain near-term outlook that includes lower growth this year in China, the world's largest consumer of key commodities.

Copper and gold prices were steady on Wednesday but oil fell, with Brent crude losing 50 cents to $114 a barrel and U.S. crude falling around 0.6 percent to below $92.

The euro fell 0.1 percent to around $1.2865, while the dollar rose by a similar percentage against a basket of major currencies.