The Rulebook heading on page 16 says:
Using Weapons and Spells in Combat
Only the investigator engaged in combat can cast spells and use weapons against the monster that it is engaged with.
also
An investigator must successfully cast a spell in order to gain its benefit.
The only excepion to this, would be cards that are specifically worded to affect other players, as EvilAmarant7x points out with Intervene.