Credit fears haunt global stocks; dollar rally pauses

By Ian Chua LONDON (Reuters) - Concern about the health of the financial sector drove global stocks to their lowest in nearly two years on Tuesday, while the dollar ran out of puff after rising to its highest this year against a basket of major currencies. Wall Street looked set to struggle at the open with U.S. stock index futures all wallowing in negative territory. Underscoring a worsening outlook for global economic growth, the Bank of Japan cut its assessment of the world's second biggest economy, but a report showing a bounce in German investor sentiment in August helped inject a glimmer of hope. Still, investors were focused on the financial sector after an article in Barron's renewed worries that a government bailout was needed for the two biggest U.S. home finance providers, Fannie Mae and Freddie Mac . "Overall the... [read full story]