North American markets were mired in red ink Friday morning as investors seem to focus on the negative side of things, whether it be the economic outlook or the forecast for third-quarter corporate earnings.

At midday, Toronto’s S&P/TSX composite index was off 7.5 points or 0.09% at 8390.55 after falling 56 points Thursday; the TSX Venture Exchange dipped 11.72 points or 0.78% at 1497.87 after slipping 2.4 points Thursday.

In New York, the Dow Jones Industrial Average was down 49.33 points or 0.49% at 10001.0. In the prior session, the benchmark index tumbled below 10000 for the first time in two months. Twenty of the Dow’s 30 stocks were moving lower. The Nasdaq composite index was off 24.06 points or 1.27%% to 1865. On Thursday, the tech-rich index tumbled to a nine-month low before rebounding. The Standard & Poor’s 500 Index was down 6.87 points or 0.63%, to 1098.97.

The Canadian dollar fell 0.29 of a cent to US75.65¢ as the American currency appreciated.

Markets appeared doomed from the outset Friday thanks to worse-than-expected reports from Microsoft Corp. and Amazon.com Inc. After the market close Thursday, Microsoft reported fiscal fourth-quarter earnings of US25¢ a share vs US14¢ from a year ago, short of the US29¢ Wall Street was looking for. On top of that, the technology giant cut its fiscal 2005 earnings forecast to a range of US$1.05 to US$1.08 a share from a prior projection of US$1.16 to US$1.18 a share.

Amazon.com Inc. posted a US$76.4-million profit in the second quarter as revenue leaped 26%, prodded by the Internet retailer’s offer of free shipping. However, earnings missed by a penny a share and the company’s forecasts for the third quarter were also weaker than analysts expected.

Together, the reports deepened concerns that corporate earnings growth is slipping, and that makes investors worry about stock valuations.

In Toronto, gold and information- technology subindices lead the decline, down 2.3% and 0.47%, respectively. Among the latter, Nortel Netwoks Corp. was trading down 6¢ to $5.57 with more than 3.3 million shares trading hands.

Financials were in the black Friday morning, up 0.27% at noon, with most of the big banks posting gains.

Energy shares were up slightly as the price of light, sweet crude for September delivery was up US24$ to US$41.60 a barrel in New York after Russia’s biggest exporter, the troubled Yukos company, said its shipments may be disrupted if the government seizes its Siberian assets to settle a multi-billion dollar tax bill.

Overseas, London’s FTSE 100 was up 19.3 points to 4,325.6. Frankfurt’s DAX 30 faded 0.3% and the Paris CAC 40 was off 0.25%.

In Asia, Tokyo’s Nikkei Stock Average of 225 issues closed down 97.71 points, or 0.9%, at 1,1187.33 and Hong Kong’s Hang Seng Index gained 32.78 points, or 0.3% to 1,2352.99.