Wires

GLOBAL MARKETS- Gloomy growth picture and Europe's woes hit shares, euro

* World shares fall after IMF forecasts weaker growth

* U.S. stocks poised to open lower

* Oil jumps on supply concerns as Middle East tension mounts

* Uncertainty over Spain and Greece pressures euro

By Richard Hubbard

LONDON, Oct 9 (Reuters) - A stark warning from the IMF aboutthe global growth outlook and the prospects for Spain and Greecesent European stocks and the single currency lower on Tuesday,while oil rose on escalating tensions in the Middle East.

U.S. stock index futures pointed to Wall Street followingthe downward trend in equity markets when trading opens.

The gloomier picture of the economic outlook came as riskierasset markets such as equities are on the hunt for confirmationof a pick-up in activity after prices rose sharply last monthwhen the world's major central banks eased policy aggressively.

The International Monetary Fund's decision to mark downfuture growth in emerging markets as well as developingeconomies sent global shares, as measured by the MSCI worldequity index , down 0.2 percent.

In the IMF's latest World Economic Outlook, released aheadof the G7 Finance Ministers meeting in Tokyo, the global growthforecast for 2012 was cut for the second time since April to 3.3percent compared to the 3.5 percent expected in its July report.

The Fund also warned that any failure by policymakers in theUnited States and Europe to fix their economic problems couldeven prolong the current slump.

In Europe the likely impact of the weaker growth oncorporate earnings helped send the FTSEurofirst 300 index

of top company shares down 0.1 percent to 1,099.64points, adding to its 1 percent loss on Monday.

The euro fell 0.2 percent to $1.2940 , over a centbelow a two-week high of $1.3072 hit on Friday.

"The main driver for the market is the IMF report on Greeceand they also have a more negative view on Spain, which raisesquestions about whether the budget deficit targets for next yearwill be achieved," said RIA Capital Markets strategist NickStamenkovic.

European Central Bank President Mario Draghi added hisweight to the gloomier view, telling European lawmakers meetingin Luxembourg he expected weak activity to continue with therisks to even this forecast on the downside.

"Some things have improved in the last to two or threemonths, but I think the road ahead is still long and it'suphill," Draghi said.

The growth worries offset a slightly more positive mood inAsian markets which followed China's injection of around $42billion of cash into its money markets. That boosted speculationits central bank may soon do more to support slowing growth.

The MSCI index of Asia-Pacific shares outside Japan

added 0.5 percent, pulled higher by rises inHong Kong and China shares after the move.

"Given the softness in the economy and given where inflationis, there is certainly scope for China to be more active on thepolicy front," said Ian Richards, global head of equitiesstrategy at Exane BNP Paribas.

<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ IMF growth forecasts: Greece vs Germany: Oil priced in euros: ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^> EURO ZONE PROGRESS EYED

Apart from the IMF report, the focus in Europe was on asummit of finance ministers and a visit to Athens by the GermanChancellor Angela Merkel, which are both being closely watchedfor signs of progress in resolving the region's debt crisis.

The finance ministers and the IMF were reported on Monday tohave held a "thorough and robust" debate on Greece, but failedto make significant progress in deciding how best to get thecountry back on track with its bailout programme.

Greece is locked in talks with its "troika" of lenders - theEuropean Union, ECB and IMF - to secure the next tranche of a130-billion-euro ($170-billion) loan package, its second bailoutsince 2010. Without the next 31.5 billion euro payment, Greecesays it will run out of money by the end of November.

The finance ministers also appeared to dash market hopes ofan early bailout request from Spain by saying the country wastaking steps to overhaul its economy, and successfully fundingitself in the financial markets.

Investors are waiting for Spain's bailout request as itwould trigger a new round of bond buying by the ECB which wouldlikely lift the euro and send Spanish bond yields sharply lower.

"While uncertainty about Spain plays out, investors are alsogetting worried about the Greek situation," said Adam Myers,senior currency strategist at Credit Agricole.

The lack of progress saw Spanish 10-year yields

gain 5 basis points to around 5.78 percent butthey remain comfortably the six percent level that would likelypush the government towards seeking help.

OIL SUPPLY THREAT

Attention in the oil markets was on the deterioratingsituation in Syria and a warning from Turkish President AbdullahGul that the worst case scenarios between his country and itsneighbour are now playing out.

Turkey's armed forces have bolstered their presence alongthe border with Syria in recent days and have been responding inkind to gunfire and shelling from Syrian forces.

"There are latent supply risks on the oil market sinceTurkey might become involved in the conflict in Syria, whichwould affect key oil transport routes," said a Commerzbankresearch note.

Brent crude oil futures rose 54 cents to $112.36 andU.S. crude climbed 31 cents to $89.64 leaving the gapbetween the two at around $22.70 per barrel, the highest sinceOct. 20 last year.

(Additional reporting by Peg Mackey and Anirban Nag; Editing byPeter Graff and Giles Elgood)

((richard.hubbard@thomsonreuters.com)(Tel +44 207 5423215))

Keywords: MARKETS GLOBAL/