World stocks drift amid uncertain global economy

Global stock markets drift lower as traders weigh prospects of global economic slowdown

Associated Press

HONG KONG (AP) -- Global stock markets drifted lower in lackluster trading Monday as investors saw few optimistic indicators to weigh against the prospects of a global economic slowdown.

Benchmark oil remained above $106 per barrel while the dollar rose against the euro and the yen.

In early European trading, Germany's DAX slid 0.2 percent to 6,981.43 while France's CAC-40 retreated 0.3 percent to 3,466.11. The FTSE 100 index of leading British companies edged up 0.1 percent to 5,862.13.

U.S. stocks were poised to fall. Dow futures were marginally lower at 13,029 while broader S&P 500 futures lost less than 0.1 percent to 1,393.20.

Japan's Nikkei 225 index rose less than 0.1 percent to end at 10,018.24 as the yen slipped against the dollar, helping the country's powerhouse export sector. Markets elsewhere had a tepid start to the week after reports in China and Europe last week pointed to a likely slowdown in those economies.

Hong Kong's Hang Seng Index finished unchanged at 20,668.86 but property companies rebounded as investors shook off worries that the social reform policies promised by the city's next leader would hurt home prices.

South Korea's Kospi index fell 0.4 percent to 2,019.19. Australia's S&P ASX/200 shed 0.2 percent to 4,262.80. Benchmarks in Singapore, Taiwan and Indonesia also fell. New Zealand was higher.

"The market is still lacking positive catalysts," said Jackson Wong, a vice president at Tanrich Securities, who noted that investors are hanging back as they await market-moving news.

Germany is set to release later Monday its monthly index of business confidence, a closely watched indicator for Europe's biggest economy. Earnings reports by Cheung Kong Holdings Ltd. and Hutchison Whampoa Ltd., controlled by Hong Kong's richest man, Li Ka-shing, are due Thursday.

Mainland Chinese shares were flat. The benchmark Shanghai Composite Index was less then 0.1 percent higher at 2,350.60 while the smaller Shenzhen Composite Index was unchanged at 952.76.

Real estate- and media-related companies weakened. China Vanke, the country's biggest real estate developer, lost 1.2 percent while No. 2 Poly Real Estate lost 0.8 percent.

"Investors worry GDP data in the first quarter might be 7 to 7.5 percent instead of the earlier 7.5 to 8 percent" that's been forecast, said Peng Yunliang, an analyst based in Shanghai.

Shares of Qantas Airways Ltd. rose 2 percent in Sydney after it announced plans to set up a Hong Kong-based discount airline with China Eastern Airlines Co.

Chinese auto and battery maker BYD Co. fell 4.8 percent in Hong Kong after it reported 2011 profit fell by nearly half as the country's booming auto sales slowed and competition intensified.

Shares of China Construction Bank, one of China's four major state-owned lenders, fell 1 percent in Hong Kong even after reporting 2011 profit rose 25.5 percent despite government-imposed credit curbs and slowing economic growth.

Big Hong Kong property developers rebounded on hopes that social reform policies espoused by Leung Chun-ying, who was selected Sunday to be Hong Kong's next chief executive and pledged to expand public housing, would not bring down house prices. New World Development Co. rose 3.8 percent, Sino Land Co. was up 3.8 percent and Henderson Land Co. climbed 2.1 percent.

"We reiterate our view that general property prices will not fall substantially on the simple theme of Leung taking office," Citigroup analysts said in a report.

Benchmark oil for May delivery was down 46 cents to $106.41 in electronic trading on the New York Mercantile Exchange. The contract was up $1.52 to end at $106.87 per barrel in New York on Friday.

The euro weakened to $1.3205 from $1.3263 late Friday in New York. The dollar rose to 82.88 yen from 82.49 yen.

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AP researcher Fu Ting in Shanghai contributed to this report.

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