A roundup of trading on major world markets:
NEW YORK – US stocks edged lower in afternoon trading with bank stocks leading the way down.
Stocks opened higher Monday but soon fell after an hour of trading. Cautious comments from the head of the European Central bank soured any hopes the ECB would find a resolution to Europe’s debt crisis anytime soon.
A report in The Wall Street Journal also said US regulators will likely force US banks to follow stricter rules to shore up their finances. The rules are aimed at keeping banks from failing but would pinch profits.
The Dow fell 51 points, or 0.4 per cent to 11,815 as in early afternoon trading.
The Standard & Poor’s 500 index fell 8 points, or 0.6 per cent, to 1,212. The Nasdaq composite index fell 16, or 0.6 per cent, to 2,539.
Mario Draghi, the ECB president, said that the central bank was looking for ways to keep the Eurozone’s bailout fund effective even if credit rating agencies strip France of its AAA grade.
The bailout fund depends on the top ratings of France, Germany and the countries that contribute to it. Draghi also restated his view that large-scale government bond purchases were outside the central bank’s responsibility.
A gauge of sentiment among home builders inched up to its highest level since May 2010. The National Association of Home Builders/Wells Fargo builder sentiment index added two points to 21 in December. Any reading below 50 still reflects a negative outlook.
LONDON – European stocks have closed mostly lower, giving up gains as markets waited on talks between EU finance ministers and kept a wary eye on Asia after the death of North Korea’s Kim Jong-il.
Dealers said the initial reaction to the death of Kim Jong-il was that there would be no broad change in North Korea after the death of its leader but everyone knows how unpredictable Pyongyang can be and so were cautious.
Trade was quiet as investors wound down for the Christmas break after the huge volatility of recent months driven by every twist and turn of the eurozone debt crisis, they said.
A teleconference between eurozone finance ministers on meeting pledges of some 200 billion euros ($A262 billion) in fresh funds for the International Monetary Fund was the main focus of attention but the outcome remained uncertain.
Senior European Commission economy spokesman Olivier Bailly said the hope was that ministers would meet the commitments made but added that today was a “political deadline, not a legal deadline”.
Fitch Rating’s decision on Friday to downgrade France’s outlook and warn of possible downgrades for six other eurozone countries was another negative.
In London, the FTSE-100 index of top companies closed down 0.42 per cent at 5,364.99 points on Monday.
In Paris, the CAC-40 edged up 0.06 per cent to 2,974.20 points while in Frankfurt the DAX 30 fell 0.54 per cent to 5,670.71 points.
Madrid gained 0.60 per cent, bucking the trend but off its highs after incoming prime minister Mariano Rajoy outlined plans to slash the budget deficit next year by 16.5 billion euros.
HONG KONG – Asian shares fell following news that North Korean leader Kim Jong-Il had died, raising geopolitical concerns in the region amid uncertainty over the future of the nuclear-armed nation.
Markets began the day on a low because of worries over the ongoing European debt crisis after Belgium’s credit rating was cut, France’s outlook was lowered and six other eurozone members were put on downgrade watch.
Seoul closed down 3.43 per cent, or 63.03 points, at 1,776.93, Tokyo shed 1.26 per cent, or 105.60 points, to close at 8,296.12 and Sydney tumbled 2.38 per cent, or 98.8 points, to 4,060.4.
Hong Kong lost 1.18 per cent, or 215.18 points, to end at 18,070.21, Shanghai lost 0.30 per cent, or 6.61 points, to end at 2,218.24 and Taipei fell 2.24 per cent, or 151.76 points, to 6,633.33.
WELLINGTON – New Zealand shares fell, led by companies with ties to the Australian economy after a profit warning by a Billabong in Australia stoked concerns that growth in the nation’s biggest export market is faltering.
The NZX 50 Index fell 22.30 points, or 0.7 per cent, to 3223.03. Within the index, 21 stocks fell, 19 rose and 10 were unchanged. Turnover was $NZ48.6 million.
