World stocks muted ahead of US growth figures
Friday, 27 January 2012 | 12:44
World stocks faced multiple headwinds Friday after disappointing Japanese earnings, higher unemployment in Spain and weak U.S. home sales. Investors awaited quarterly growth figures from the U.S. later in the day.
Benchmark oil hovered below $100 per barrel while the dollar was lower against the euro and the yen.
European shares headed lower as the latest data from Spain, which already has the highest unemployment rate among the 17 nations that use the euro, showed more than 5 million people without jobs. The National Statistics Institute said the jobless rate shot up from 21.5 percent to 22.8 percent in the fourth quarter.
Britain's FTSE 100 slipped 0.3 percent to 5,775.29. Germany's DAX was off 0.1 percent to 6,531.89 and France's CAC-40 lost 0.4 percent to 3,349.82. Wall Street appeared set to open in negative territory, with Dow Jones industrial futures down marginally to 12,679 and S&P 500 futures falling less than 0.1 percent at 1,214.50.
Asian stock markets closed mostly higher, ahead of the release of fourth quarter U.S. economic growth figures. Economists predict growth will strengthen to around 3 percent in the October-December quarter from about 2 percent in the third quarter. Analysts at Credit Agricole CIB in Hong Kong said the reading was expected to "look healthy."
Japan's Nikkei 225 index fell 0.1 percent to close at 8,841.22.
South Korea's Kospi rose 0.4 percent to 1,964.83. Hong Kong's Hang Seng rose 0.3 percent to 20,501.67, while Australia's S&P/ASX 200 gained 0.4 percent to 4,288.40.
Attention was also focused on the resumption of talks to reach a deal on how Greece can avoid a catastrophic default on its debt. Greece and its bailout rescuers _ other countries that use the euro and the International Monetary Fund _ are asking private creditors to swap their Greek bonds for new ones with a lower value and interest rate.
The two sides have so far disagreed over what interest rate the new bonds should take.
In the U.S., stocks slipped Thursday after the government reported an unexpected drop in new home sales in December, capping the worst year for home sales since record-keeping began in 1963. But there were some bright spots. Orders to factories for long-lasting manufactured goods increased in December for the second straight month, and a key measure of business investment rose solidly.
Japanese exporters continued to be hit by a strong yen, which reduces the value of repatriated profits. Honda Motor Corp. slid 1.9 percent and Panasonic Corp. shed 2.3 percent. Fujitsu Ltd. plunged 3.5 percent.
Nintendo Corp., the Japanese gaming giant behind the Super Mario and Pokemon games, plummeted 4.1 percent, a day after it lowered its annual earnings forecast to a 65 billion yen ($844 million) loss. The company blamed the strong yen for much of the loss.
Japanese electronics company NEC Corp. plummeted 7.1 percent after announcing Thursday that it was slashing 10,000 jobs worldwide and would slide into the red for the full year.
Benchmark oil for March delivery was down 11 cents to $99.60 per barrel in electronic trading on the New York Mercantile Exchange. The contract rose 30 cents to finish at $99.70 per barrel on the Nymex on Thursday.
In currencies, the euro rose to $1.3107 from $1.3104 late Thursday in New York. The dollar fell to 77.05 yen from 77.49 yen.
Source: Associated Press
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