* U.S., Europe stocks can"t sustain 17-month highs
* Greece worries weigh; euro hits 2-week low vs dollar
* Investor sentiment darkens, correction seen (Updates with U.S. closing prices)
By Al Yoon
NEW YORK, March 19 (Reuters) - Global shares slipped from17-month highs on Friday as weakness in earnings and a risingdollar stunted long-running rallies, while concerns overGreece"s debt burden kept pressure on the euro.
Oil suffered its steepest drop in six weeks as the dollarfirmed against the euro and other currencies. Cheaper crude oilweighed on energy shares in the United States and Europe.
The euro posted its worst weekly performance against thedollar since late January as traders waited to see if Greececan secure aid from its fellow euro zone members at a EuropeanUnion summit next week. Greece has said that it might have toturn to the International Monetary Fund for help.
"The tensions surrounding Greece are escalating. This wholeIMF situation has become a game of brinkmanship and the wholeuncertainty is undermining the euro," said Michael Woolfolk,senior currency strategist at BNY Mellon in New York.
In equities, an early boost to bank shares came as Britishlender Lloyds Banking Group (LLOY.L) said it would return toprofit this year after two years of heavy losses, helped bylower bad debts and tight cost controls. Shares of Lloydsjumped 8.2 percent in London, but European stocks closed loweron a late-session selloff in resource-related sectors ascommodities prices fell. For details see [ID:nLDE62I07H].
The MSCI world equity index .MIWD00000PUS fell 0.5percent.
In U.S. equities, the Dow Jones industrial average .DJIfell 37.19 points, or 0.35 percent, to 10,741.98. The Standard Poor"s 500 Index .SPX slipped 5.93 points, or 0.51 percent,to 1,159.90 and the Nasdaq Composite Index .IXIC declined16.87 points, or 0.71 percent, to 2,374.41.
Analysts warned of volatility due to "quadruple witching"-- the expiration of U.S. stock index futures, stock indexoptions, stock options and stock futures.
"Even with a one-year rally of almost historicalproportions, investors remain in a very skeptical market," saidKeith Springer, president of Capital Financial AdvisoryServices in Sacramento, California.
The number of individual investors who were bullishdeclined nearly 10 percentage points to 35.4 percent in thelatest week, according to a survey by the American Associationof Individual Investors. Bearish calls rose 4.6 percentagepoints to 29.9 percent.
Friday"s decline was mostly a technical one after an 11percent rise in the SP 500 since Feb. 5, Springer said.
Barclays Capital, the investment banking arm of BarclaysPlc, on Thursday predicted equity markets would continue theirrally this year, but only after signs of stalling earningscause a second-quarter correction. The firm increased its 2010target for the SP 500 Index to 1,210 from 1,120.
Palm Inc"s (PALM.O) stock plunged 29 percent to $4 a dayafter it warned that quarterly revenue would fall far belowexpectations, as tepid demand for its smart phones leftwireless carriers with piles of inventory. [ID:nN18254531]
"When there are fewer and fewer customers ... the low endof the totem pole gets squeezed out," said Capital Financial"sSpringer. "That"s what happens in a downturn."
A rising dollar and lower oil prices sapped energy stocks-- the SP Energy Index .GSPE fell about 1 percent.
In Europe, the FTSEurofirst 300 .FTEU3 index of topEuropean shares closed 0.4 percent lower at 1,065.48.
The index earlier touched a 17-month high, boosted by bankstocks UBS (UBSN.VX), Barclays (BARC.L) and Credit Agricole(CAGR.PA), which ended up 1.5 percent to 1.7 percent.
But oil and metal prices took a beating while the dollarrose. Dollar-denominated oil and metals become more expensivefor holders of other currencies when the dollar rises.
U.S. light sweet crude oil CLc1 fell $1.54, or 1.87percent, to $80.66 per barrel, also pressured after an industryreport suggested OPEC exports were rising. Spot gold pricesXAU= fell $20.10, or 1.79 percent, to $1,105.30 an ounce.
GREECE WORRIES
Concerns over Greece and doubts over whether euro zonestates will agree to any support package still hurt sentiment,keeping the euro weak and hampering peripheral debt prices astraders waited for next week"s European Union summit.
The euro zone currency EUR= fell 0.52 percent against thedollar to $1.3535, near its lowest level in more than twoweeks, while increased risk aversion helped flows into the U.S.currency. The dollar .DXY rose 0.63 percent against a basketof major currencies to 80.73.
"I think the market doubts whether next week"s summit willproduce anything more specific in terms of a plan for Greece,"said Chris Turner, head of FX strategy at ING.
Against the Japanese yen, the dollar JPY= gained 0.24percent to 90.49 yen.
Weakness in equities aided sovereign debt, but U.S.Treasury debt prices edged lower in the face of $118 billion indebt next week. Benchmark 10-year note yields rose 0.02percentage point to 3.70 percent. (Additional reporting by David Brett and Naomi Tajitsu inLondon and Rodrigo Campos in New York; Editing by KennethBarry)
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