U.S. Markets open in 7 hrs 58 mins

Global shares slip on worries over Greece; oil drops

Specialist trader Michael Gaglilano (L) gives a price for stocks to traders working on the floor of the New York Stock Exchange February 2, 2015. REUTERS/Brendan McDermid

By Sam Forgione

NEW YORK (Reuters) - Stock markets worldwide slipped on Wednesday on investor worries over the outcome of euro zone ministerial meetings about Greece's debt crisis, while oil prices dropped for a second day on more signs of oversupply.

Greek Finance Minister Yanis Varoufakis and euro zone finance ministers continued negotiations after the country's new leftist-led government warned it will end cooperation with organizations overseeing the country's bailout program.

European Union leaders were due to meet on the same matter on Thursday. The unease over Greece pulled European stocks lower, with Greek shares slumping 4 percent (.ATG). U.S. stocks dipped. [.N]

"Europeans, regardless of the outcome of the negotiation, are looking at some rather troubling developments," said John Brynjolfsson, chief investment officer of hedge fund Armored Wolf in Irvine, California. "There's a possibility that the parties can't come to terms and you have a Grexit," referring to a Greek exit from the euro zone.

Adding to the markets' uncertainty, the leaders of France, Germany, Russia and Ukraine began peace talks in Belarus, while in Ukraine, pro-Moscow separatists tightened the pressure on Kiev by launching some of the war's worst assaults.

Brent crude oil hit a session low of $53.91 a barrel after government data showed U.S. crude stockpiles hit record highs. U.S. commercial crude oil stockpiles rose almost 5 million barrels last week to nearly 418 million barrels, the highest since records began in 1982, according to the report.

The data stoked concerns of oversupply. The latest two-day fall in oil prices came after prices, down about 50 percent since June, have rallied more than 20 percent in the last four weeks.

Brent crude (LCOc1) settled down $1.77 at $54.66 a barrel. U.S. crude (CLc1) settled off $1.18 at $48.84 a barrel. [O/R]

The Dow Jones industrial average (.DJI) fell 1.85 points, or 0.01 percent, to 17,866.91, the S&P 500 (.SPX) gained 0.73 points, or 0.04 percent, to 2,069.32 and the Nasdaq Composite (.IXIC) added 16.25 points, or 0.34 percent, to 4,803.90.

In Europe, the FTSEurofirst 300 index (.FTEU3) of top regional shares ended 0.32 percent lower at 1,483.69. MSCI's all-country world stock index <.MIWD00000PUS> was off 0.35 percent at 419.64.

The U.S. dollar hit a five-week high against the Japanese yen at 120.44 yen (JPY=), bolstered by a rise in U.S. Treasury yields earlier in the session. The euro fell to a seven-year low against the British pound and slipped versus the dollar for a second straight session on concerns about Greece.

"I think it's going to be down to watching the headlines from the Eurogroup," said Vassili Serebriakov, currency strategist at BNP Paribas in New York.

Benchmark 10-year Treasury note yields were little changed from late Tuesday at 1.99 percent. [US/]

Gold fell to a one-month low as the dollar's rise against the yen pushed spot prices through key support at $1,229 an ounce. U.S. gold for April delivery (GCcv1) settled down 1 percent at $1,219.60 an ounce.

(Additional reporting by Marc Jones in London and Chuck Mikolajczak and and Gertrude Chavez-Dreyfuss in New York; Editing by James Dalgleish and Jeffrey Benkoe)