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Markets sluggish after recent gains, await US news

Pan Pylas, AP Business Writer

In this Friday, Jan. 25, 2013, photo, Trader Michael Urkonis, center, works on the floor of the New York Stock Exchange. Wall Street appeared headed for a day of trade without drama Monday Jan. 28, 2013. (AP Photo/Richard Drew)

LONDON (AP) -- Markets began the week sluggishly after a buoyant start to the year had pushed many of the world's major stock indexes to multiyear highs.

Any hope that U.S. trading would help European markets rise dissipated after the release of mixed economic data. That added to the caution of investors, who seemed reluctant to chase stocks to new highs. On Friday, the S&P 500 closed above 1,500 for the first time in more than five years.

"There's another run of U.S. earnings news in the coming days and the week will culminate in the release of the latest non-farm payrolls, so there's absolutely no shortage of potential for traders to want to start booking some profits at these heady levels," said Fawad Razaqzada, market strategist at GFT Markets.

In Europe, the FTSE 100 index of leading British shares was up 0.3 percent at 6,301 while the CAC-40 in France rose 0.1 percent to 3,782. Germany's DAX was 0.2 percent lower at 7,844.

In the U.S., the Dow Jones was 0.2 percent lower at 13,969 while the S&P 500 fell 0.4 percent to 1,497.

U.S. indicators failed to deliver any renewed momentum. Though durable goods orders for December came in stronger than anticipated, pending home sales for the month were weaker than expected.

The U.S. will likely remain in the spotlight this week, with the Federal Reserve's meeting on Wednesday potentially the biggest market event. Fourth-quarter growth data are due later in the week as are nonfarm payrolls figures, which often set the market tone for a week or two.

"This week therefore has the potential to make or break the stock market rally," said Craig Erlam, market analyst at Alpari.

Earlier, Asian markets posted slight gains Monday after strong U.S. earnings pushed Wall Street indexes to multiyear highs on Friday.

Hong Kong's Hang Seng rose 0.4 percent to 23,671.88. Mainland Chinese shares ended higher, with the Shanghai Composite Index jumping 2.4 percent to 2,346.51. The smaller Shenzhen Composite Index gained 2.5 percent to 932.61.

Japan's Nikkei was a standout, falling quite sharply amid profit-taking. The Nikkei in Tokyo opened higher but then slipped 0.9 percent to close at 10,824.31 as investors cashed in shares following strong gains.

Trading was lackluster in other financial markets, too, with the euro down 0.1 percent at $1.3444 and the dollar down by the same rate against the Japanese yen, at 90.76 yen.

Oil prices proved a bit more robust, with the price of benchmark New York crude 52 cents higher at $96.40 a barrel.


Pamela Sampson in Bangkok contributed to this report.