Wednesday, May 23, 2018
News: Page (1) of 1 - 02/10/12 Email this story to a friend. email article Print this page (Article printing at page facebook
World stocks slip as Greek bailout hangs in limbo
World stock markets down after European finance minister demand further cuts from Greece
By The Associated Press

BANGKOK (AP) ' World stock markets dropped Friday after Europe's finance ministers demanded more spending cuts from Greece before clearing a euro130 billion ($170 billion) bailout to stave off the country's bankruptcy.

Benchmark oil fell to near $99 per barrel while the dollar rose against the euro but fell against the yen.

European shares fell in early trading. Britain's FTSE 100 lost 0.5 percent to 5,865.53 while Germany's DAX lost 0.8 percent to 6,736.57. France's CAC-40 was 0.8 percent lower at 3,398.35. Wall Street was set for a lower opening, with Dow Jones industrial futures down 0.5 percent at 12,781 and S&P 500 futures losing 0.6 percent to 1,340.50.

Investors booked profits in Asia as traders cautioned clients to gird for a debt default by Greece.

"Today's headlines underline what most investors know to be true: Greece will default," said Andrew Sullivan, principal sales trader at Piper Jaffray in Hong Kong.

Japan's Nikkei 225 index fell 0.6 percent to close at 8,947.17. Hong Kong's Hang Seng lost 1.1 percent to 20,783.86 and South Korea's Kospi dropped 1 percent to 1,993.71. Australia's S&P/ASX 200 shed 0.8 percent to 4,245.30.

Greece announced an agreement with European debt inspectors Thursday to cut costs as a condition of getting bailout money that would keep it from defaulting on its debt next month ' an event that would send shock waves through the world financial system.

But finance ministers from nations that use the euro said Athens didn't go far enough and have given Greece just a few more days to find an extra euro325 million ($430 million) of spending cuts and get parliament to approve the measures.

All that suggests "further uncertainty on the horizon," Credit Agricole CIB in Hong Kong wrote in an email. "A Greek parliamentary vote set to begin this weekend may see some progress but markets will trade cautiously ahead of the vote."

The austerity package that failed to satisfy European finance ministers already calls for Greece to make steep new cuts in government jobs and spending. The country's international lenders insisted on the cuts as a condition for a euro130 billion emergency bailout that Greece urgently needs to make a bond payment next month.

The cuts will be hard to implement in a country that has grown used to profligate government spending. Protesters have taken to the streets of Athens regularly to denounce the government and its austerity measures.

Jackson Wong, vice president at Tanrich Securities in Hong Kong, said investors were taking profits after markets posted solid gains earlier in the week.

"Everyone is waiting for results to see if the 130 billion euro rescue fund can be dispersed," he said.

Second-tier stocks in Hong Kong, particularly appliance makers, were benefiting from the rotation out of blue chips that often occurs once the market reaches a temporary high, Wong said. Haier Electronics Group Co. rose 2 percent and Skyworth Digital Holdings jumped 3.6 percent. GOME Electrical Appliances was 1.4 percent up.

But financial shares sagged amid the uncertainty surrounding Greece. Mitsubishi UFJ Financial Group lost 2.8 percent. South Korea's Shinhan Financial Group Co. lost 3.4 percent.

Mainland Chinese shares edged higher with the benchmark Shanghai Composite Index gaining 0.1 percent to 2,351.98. The Shenzhen Composite Index gained 0.5 percent to 903.64.

Chinese real estate shares gained ground on what some analysts said were misplaced hopes of government help for the struggling sector. Poly Real Estate, China's second largest listed property developer, gained 3.3 percent while industry China Vanke gained 2 percent.

Australian mining giant Rio Tinto dropped 2.3 percent, a day after reporting a 59 per cent slump in full year profit due to a writedown of its aluminum business. Rival BHP Billiton, which reported weaker-than-expected profits earlier this week, fell 2.3 percent. Energy Resources of Australia tumbled 3 percent.

Hong Kong-listed Lenovo Group Ltd., the world's second biggest personal computer maker, jumped 3.5 percent a day after reporting that quarterly profit grew by more than half.

Benchmark oil was down 57 cents to $99.27 per barrel in electronic trading on the New York Mercantile Exchange. The contract rose $1.13 to finish at $99.84 per barrel on the Nymex on Thursday.

In currencies, the euro fell to $1.3258 from $1.3290 late Thursday in New York. The dollar fell to 77.57 yen from 77.66 yen.

Page: 1


Our Privacy Policy --- About The U.S. Daily News - Contact Us - Advertise With Us - Privacy Guidelines