Demand for US-made capital goods recorded its biggest drop in eight months in September, a cautionary note for an economy that otherwise seems to be moving forward at a steady clip.

Global stocks slid and the euro hit a four-month low yesterday on worries about a potential exit by Greece from the eurozone, while the outlook for slower world growth worsened after China moved to prop up lending.

US government bond prices continued lower in afternoon trade after the Philadelphia Fed business activity index rose sharply, breaking into positive territory for the first time in more than a year, dealers said.