The dollar slid to new multi-year lows against European currencies on Wednesday as bleak earnings news from the U.S. technology sector raised the prospect of further outflows from dollar assets. 

Futures markets were pointing to hefty losses at the Wall Street open after U.S. chipmaker Advance Micro Devices and Apple Computer warned of falling revenue after the closing bell. 

"There seems to be little that can halt the dollar's slide," said Daniel Hanna, economist at Standard Chartered. 

"Disappointing earnings forecasts are weighing on U.S. stocks and there is nervousness ahead of U.S. current account data tomorrow." 

The dollar's fortunes have been closely allied with U.S. stocks in recent weeks, with Wall Street seen as a barometer of investor confidence in corporate America. 

The dollar fell half a percent to $0.9574 per euro in the European session -- its lowest level since January 2001 -- bringing its losses to more than 10 percent since early February. 

Rising geopolitical tension also soured sentiment toward the dollar after Israel announced it would recapture and hold parts of Palestinian-ruled West Bank territory. 

The move, which followed a suicide bomb in Jerusalem on Tuesday, knocked to dollar below 1.5420 Swiss francs to its lowest since November 1999. 

JAPAN INTERVENTION WARINESS 

The dollar also slipped against the yen, but wariness of more intervention from Japan meant its losses were more muted than against European currencies. 

Japan has sold yen for dollars on at least four days in the last month, concerned the currency recent strength could choke the country's fragile export-led recovery. 

The dollar fell to session lows below 124 yen in the European session to its lowest level since June 4 when Japan last intervened but it remained more than a yen above six-month lows set at the end of May. 

"If it weren't for fears of intervention, the dollar would be lower against the yen than it is," said a trader from a European bank. 

Senior Finance Ministry official Zembei Mizoguchi warned earlier on Wednesday that Japanese authorities were monitoring the foreign exchange market. 

U.S. FINANCING WORRIES 

The dollar has been under heavy selling pressure since early April as doubts over the strength of the U.S. recovery and a series of corporate accounting scandals have dimmed the appeal of U.S. assets. 

Until then, the dollar had enjoyed a seven-year bull-run, rising to its highest level against a basket of currencies since the mid-1980s. 

"There is concern about the U.S. corporate sector and a lot more uncertainty as to how bad it might get," said Steven Englander, currency economist at Citibank. 

The United States needs to suck in more than $1 billion worth of capital from overseas just to offset its gapping current account deficit. This means the dollar is acutely sensitive to any sign that appetite for U.S. assets is starting to wane. 

Analysts said the dollar could come under further pressure after the release of U.S. first-quarter current account data on Thursday. 

The figures are expected to show an increase in the deficit to $106.07 billion from a fourth-quarter deficit of $98.84 billion.