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World stock markets fall after US consumer confidence weakens
BANGKOK (AP) ' World stock markets fell Wednesday after a weaker U.S. consumer confidence reading shook hopes for a healthy rebound in the world's No. 1 economy.
Benchmark oil hovered above $106 per barrel while the dollar fell against the euro and the yen.
European stocks were mostly lower in early trading. Britain's FTSE 100 was down marginally to 5,869.13 and France's CAC-40 slipped 0.2 percent to 3,460.92. Germany's DAX was flat at 7,077.60.
But Wall Street was poised to rise ahead of the release later Wednesday of data on U.S. durable goods orders for February. Durable goods are products expected to last at least three years, such as appliances, cars, machinery and airplanes.
Dow Jones industrial futures were up 0.2 percent to 13,148 and S&P 500 futures gained 0.2 percent to 1,408.50.
Signs of an improvement in the U.S. economy emerged since the start of the year but the most recent indicators have been lackluster. The Conference Board said Tuesday its index of U.S. consumer confidence slipped in March and the Federal Reserve Bank of Richmond, Virginia reported that a measure of regional manufacturing plunged this month.
On top of that, Federal Reserve chairman Ben Bernanke said the U.S. job market was still weak despite recent signs of improvement.
Hardest hit in Asia was China where investors worried that weak U.S. consumer demand could add to the contraction already being experienced by Chinese manufacturers.
"All manufacturing in China is suffering from a margin squeeze. Exports are slowing down. The cost of business, oil prices and labor costs are increasing. Business is not that great," said Derek Cheung, chief investment officer at Neutron Partners INV Ltd. in Hong Kong.
Mainland Chinese shares saw their biggest lost in almost four months. The benchmark Shanghai Composite Index slid 2.7 percent to 2,284.88 while the Shenzhen Composite Index dived 4.1 percent to 909.58. Haier Co. Ltd., a major home appliances producer, lost 4.8 percent while China Textile Machinery Co. fell 5 percent.
Elsewhere in Asia, Japan's Nikkei 225 index dropped 0.7 percent to close at 10,182.57, a day after the benchmark shot to a one-year high.
Hong Kong's Hang Seng ceded 0.8 percent to 20,885.42 and South Korea's Kospi shed 0.4 percent to 2,031.74. Australia's S&P/ASX 200 bucked the trend, rising 1 percent to 4,343.50.
Analysts said some Japanese stocks were pulled lower by ex-dividend selling. Some investors had bought stocks because they were due to pay dividends and were now selling once the entitlement date to receive the dividend had past.
Sharp Corp. soared 16.3 percent after Taiwan electronics manufacturer Hon Hai Precision Industry Co. announced it was taking a 10 percent stake in the struggling Japanese electronics company.
Benchmark oil was down 74 cents to $106.60 per barrel in electronic trading on the New York Mercantile Exchange. The contract gained 30 cents to $107.33 per barrel on the Nymex on Tuesday.
In currency trading, the euro rose to $1.3350 from $1.3336 late Tuesday in New York. The dollar fell to 82.89 yen from 83.09 yen.
AP researcher Fu Ting contributed from Shanghai.