* Materials drag on Europe shares, Wall St weighed by
healthcare
* Nikkei futures tumble 1.5 pct
* Oil falls again as oversupply worries resurface
(Updates prices, changes comments)
By Rodrigo Campos
NEW YORK, March 15 (Reuters) - Stocks in major markets fell
on Tuesday, with Wall Street posting subpar volume for a second
straight session, after the Bank of Japan painted a bleaker
picture of the world's third-largest economy and U.S. retail
sales data lowered expectations of a strong first quarter.
The yen rose against the U.S. dollar, crude oil dropped and
emerging market shares fell the most in more than a month.
U.S. retail sales fell less than expected in February, but a
sharp downward revision to January's numbers cooled expectations
for a strong quarter of growth for the U.S. economy.
However, the Federal Reserve is not expected to remove the
prospect of a rate hike in the near future when it ends its
two-day meeting on Wednesday.
"The Fed, I believe, is not going to do anything to take
tightening out of the equation," said Paul Zemsky, chief
investment officer, multi-asset strategies and solutions at Voya
Investment Management in New York.
He said first-quarter growth in the United States looks "a
bit worse" after the retail sales data. Taken with the recent
run-up in stocks and ahead of a Fed statement, that creates an
environment for profit-taking.
Healthcare weighed the most on the S&P 500, hurt by a 51
percent drop in shares of Valeant after the Canadian drugmaker
slashed its 2016 revenue forecast and said a delay in filing its
annual report could mean a debt default. NL3N16N3QY
After trading slightly lower for most of the day, the Dow
Jones industrial average .DJI rose 22.4 points, or 0.13
percent, to 17,251.53, while the S&P 500 .SPX lost 3.71
points, or 0.18 percent, to 2,015.93 and the Nasdaq Composite
.IXIC dropped 21.61 points, or 0.45 percent, to 4,728.67.
Daily volume on Wall Street was the second-lowest of the
year.
The pan-European FTSEurofirst 300 stocks index .FTEU3
ended down 1 percent, dragged lower by commodity-related stocks.
The STOXX Europe 600 Basic Resources index .SXPP fell 4.7
percent. Nikkei futures NKc1 dropped 1.5 percent.
MSCI's gauge of stocks in major markets .MIWD00000PUS fell
0.7 percent while emerging market shares .MSCIEF dropped 1.7
percent, the most since Feb. 11.
Brazil's Bovespa .BVSP fell 3.6 percent and the real
BRL= slipped 2.8 percent versus the dollar after former
President Luiz Inacio Lula da Silva accepted a cabinet position
in President Dilma Rousseff's government.
The move could reduce support among lawmakers for Rousseff's
ouster while offering Lula some protection from an investigation
of alleged money laundering. JUMPS
The yen strengthened after the BOJ removed from its
post-meeting statement language used after it cut rates in
January that it would lower them further into negative territory
if needed.
The dollar was down 0.6 percent at 113.14 yen JPY= .
"We are obviously in the midst of monetary policy
exhaustion," said Tina Byles Williams, chief executive officer
and chief investment officer at FIS Group in Philadelphia.
"There's anticipation of a risk-off moment and the yen is the
protection against that."
The euro EUR= was little changed against the greenback at
$1.1107. Sterling GBP= fell 1 percent to $1.4151.
Oil prices dropped further after the Organization of the
Petroleum Exporting Countries said it expected lower demand for
crude in 2016 than previously thought.
Crude inventories rose by 1.5 million barrels in the week to
March 11 to 523 million, compared with analysts' expectations
for an increase of 3.4 million barrels. Gasoline stockpiles fell
by 1.2 million barrels, compared with analysts' expectations for
a 2.3 million-barrel decline.
Brent crude LCOc1 last traded down 1.6 percent at $38.89 a
barrel, further diluting a six-week recovery in oil prices that
has helped buoy stock markets. U.S. crude CLc1 lost 1.2
percent to $36.72 in late trading.
"The rally is now retreating on fears that OPEC will
continue to flood the market with oil in a world where demand
may falter," said Phil Flynn, analyst at the Price Futures Group
in Chicago.
U.S. Treasury yields were little changed, with the 10-year
note US10YT=RR down 2/32 in price to yield 1.9699 percent.
Spot gold XAU= fell for a third straight session and five
of the last six. Copper CMCU3 was up less than 0.1 percent
after earlier falling as much as 1.3 percent.