GLOBAL MARKETS-Equities drop, bond yields rise on ECB statement, mixed earnings

* Mixed corporate earnings pull S&P 500, Nasdaq away from
highs
* ECB's Draghi sounds upbeat economic tone, leaves rates
unchanged
* Crude gains amid U.S. stockpile drop, Middle East tensions

(Updates to afternoon U.S. market trading, changes dateline,
byline)
By Stephen Culp
NEW YORK, July 25 (Reuters) - U.S. stocks backed off record
highs and bond yields rose following mixed earnings and
rosier-than-expected economic sentiment from the European
Central Bank's governor.
The ECB signaled its intention to explore monetary easing
but did not cut interest rates, and bank President Mario Draghi
sounded more upbeat on the economy than investors expected,
sending equities lower and boosting government debt yields.
"The ECB's rosier outlook may be giving the market a bit of
a chill," said Chuck Carlson, chief executive of Horizon
Investment Services in Hammond, Indiana. "The market continues
to hope for dovish central banks and the actions of one central
bank lead the market to wonder what that means for the Federal
Reserve."
A mixed bag of earnings reports from a wide range of U.S.
companies pulled Wall Street lower a day after the S&P 500 and
the Nasdaq hit all-time highs, painting a picture of profit
beats amid underwhelming guidance.
"Earnings have been decent, but the guidance isn't what the
market is looking for," Carlson added.
Downbeat guidance points to an economic slowdown in the
midst of the protracted U.S.-China trade war, which should
encourage the U.S. Federal Reserve to cut interest rates next
Wednesday for the first time in a decade.
"The Fed has kind of backed itself into a corner to cut
rates in July," said Carlson. "But there are people at the Fed
who are asking 'why are we cutting rates again?' You've got a
market at all-time highs. That tug of war is going to go on."
The Dow Jones Industrial Average .DJI fell 169.35 points,
or 0.62%, to 27,100.62, the S&P 500 .SPX lost 17.65 points, or
0.58%, to 3,001.91 and the Nasdaq Composite .IXIC dropped
79.87 points, or 0.96%, to 8,241.63.
European stocks reversed their initial gains in reaction to
the ECB's easing intentions after Draghi said the risk of a
recession in the euro zone was "pretty low" and the central bank
would wait for more data before "taking action." The pan-European STOXX 600 index .STOXX declined 0.56% and
MSCI's gauge of stocks across the globe .MIWD00000PUS fell
0.55%.
U.S. Treasury yields rose after Draghi said the ECB sees a
low risk of a recession in the euro zone, even as he
acknowledged a worsening outlook. Benchmark 10-year notes US10YT=RR were last down 8/32 in
price to yield 2.0775%, compared with 2.05% late on Wednesday.
The 30-year bond US30YT=RR last fell 21/32 in price to
yield 2.6083%, compared with 2.578% late on Wednesday.
The dollar index, which measures the greenback against a
basket of other world currencies, inched higher, while the euro
gave up earlier gains to show a nominal decline.
The dollar index .DXY rose 0.11%, with the euro EUR=
down 0.02% at $1.1137.
The Japanese yen weakened 0.45% versus the greenback at
108.70 per dollar, while sterling GBP= was last trading at
$1.2452, down 0.23% on the day.
Oil prices rose as Middle East tensions and a substantial
drop in U.S. crude stocks raised supply concerns. U.S. crude CLcv1 rose 1% to $56.44 per barrel and Brent
LCOcv1 was last at $63.75, up 0.9% on the day.
Spot gold XAU= dropped 0.8% to $1,414.60 an ounce.
Copper CMCU3 fell 0.28% to $5,982.00 a tonne.
Three-month aluminum on the London Metal Exchange CMAL3
eased 0.03% to $1,825.50 a tonne.

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Asia stock markets https://tmsnrt.rs/2zpUAr4
Asia-Pacific valuations https://tmsnrt.rs/2Dr2BQA
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BREAKINGVIEWS-Markets want to see colour of Mario Draghi's money
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