A roundup of trading on major world markets:
NEW YORK – US stocks fell on Tuesday, snapping a three-session winning streak, after a Germany-France summit dashed hopes for immediate steps to resolve the eurozone debt crisis.
The Dow Jones Industrial Average dropped 76.97 points (0.67 per cent) to finish at 11,405.93. The broad-market S&P 500 fell 11.73 points (0.97 per cent) to 1,192.76 and the tech-rich Nasdaq Composite slumped 31.75 points (1.24 per cent) to 2,523.45.
Wall Street stocks had started the day in negative territory on news that Germany, the top eurozone economy, saw only 0.1 per cent growth in the second quarter, and the eurozone’s output expanded a meager 0.2 per cent. The European data spurred fears of a slide back toward recession, just as growth in the US economy is flagging.
US economic indicators were mixed. Starts on housing construction and building permits continued to languish in July, higher than a year before but still less than half of the pace of the years before the 2008-09 recession.
Industrial production in July rose 0.9 per cent, partly due to energy use amid warmer summer weather and a pick-up in auto production as supply disruptions from the Japan earthquake disaster dissipated.
The bond market rallied. The yield on the 10-year Treasury fell to 2.21 per cent from 2.29 per cent late Monday, while that on the 30-year Treasury slid to 3.65 per cent from 3.75 per cent.
Bond yields and prices move in opposite directions.
MILAN – After an optimistic start to the trading week, stocks lost their steam after subdued German growth figures reinforced fears over the global economy.
Germany reported that growth almost ground to a halt in the second quarter, in another downbeat note for the global economy following similarly disappointing readings from France and the United States. Quarterly growth was only 0.1 per cent on lagging consumer spending and construction investment – putting a damper on recovery driven by booming exports that power Europe’s biggest economy.
The fall in German growth was the root cause behind the fall in the eurozone’s expansion to 0.2 per cent during the quarter from 0.8 per cent in the previous three-month period.
In Europe, Germany’s DAX was 0.45 per cent lower at 5,994.9 while the CAC-40 in France fell 0.25 per cent to 3,230.9. Britain’s FTSE 100 of leading British shares was up slightly at 0.13 per cent at 5,357.63.
Milan markets, in the first test of 45.5 billion euros ($A62.9 billion) in emergency austerity measures announced last week, closed down 0.87 per cent at 15,750.
The euro also was weighed down by the growth data, trading 0.3 per cent lower on the day at $1.439.
TOKYO – Asian stocks were mixed, despite impressive gains at the start of the week and a positive lead from Wall Street.
Tokyo finished 0.23 per cent higher, by 21.02 points, at 9,107.43 and Seoul added a whopping 4.83 per cent, or 86.56 points, to 1,879.87, after a public holiday on Monday. Hong Kong closed 0.24 per cent, or 48.02 points, lower at 21,212.08 and Shanghai was down 0.71 per cent, or 18.60 points, at 2,608.17.
Mumbai ended 0.65 per cent down, its third day of losses, with the Sensex index falling 108.69 points to 16,730.94, a 14-month-low.
India’s annual inflation slowed to 9.22 per cent in July but economists said the fact it remained near double digits made further interest rate hikes likely despite global economic uncertainty.
In other markets, Taipei fell 0.27 per cent, Manila added 0.92 per cent, Singapore fell 1.45 per cent, Kuala Lumpur ended down 0.10 per cent, Jakarta lost 0.17 per cent, and Bangkok fell 0.86 per cent, or 9.30 points, to 1,077.02.
WELLINGTON – The New Zealand share market was up for a second day in a row, posting a 21-point gain on the back of another strong performance by Telecom.
The benchmark NZX-50 index was up 21.1 points, or 0.65 per cent, at 3,273.746, after closing up 36.1 points on Monday.
Turnover of 29.4 million shares was worth $NZ86.9 million ($A69.26 million).
