World stock markets mostly lower after Germany’s economy contracts, France’s stagnates

HONG KONG—A contraction in Germany’s economy and stagnation in France dragged on European stocks Thursday while Asian markets ended mixed.

Keeping score

France’s CAC 40 lost 0.4 per cent to 4,176.03 and Germany’s DAX shed 0.4 per cent to 9,164.92. Britain’s FTSE 100 edged up 0.1 per cent to 6,661.95. U.S. shares were set to drift lower, with Dow futures slipping 0.1 per cent to 16,606. S&P 500 futures dipped 0.1 per cent to 1,943.60.

Asia’s day

Japan’s benchmark Nikkei 225 rose 0.7 per cent to close at 15,314.57 and Australia’s S&P/ASX 200 ended 0.6 per cent higher at 5,548.50. South Korea’s Kospi was practically unchanged at 2,063.22. But Hong Kong’s Hang Seng lost 0.4 per cent to 24,801.36, after swinging between gains and losses for most of the day. The Shanghai Composite in mainland China followed the same pattern, down 0.7 per cent to 2,206.47.

Europe sags

The latest growth figures from two major economies cast doubt over Europe’s recovery. The Germany economy lost momentum, shrinking by 0.2 per cent in the April-June period, while the French economy stagnated for second straight quarter, official reports showed.

China economy

Benchmarks in Hong Kong and Shanghai declined a day after disappointing data on the Chinese economy left investors fretting that authorities in Beijing were comfortable with slowing growth and would refrain from further stimulus. Fixed investment and industrial production for July slowed, though the big surprise was the sharp drop in loan growth, which Rabobank analyst Michael Every called “shockingly low.”

PC profits

No. 1 personal computer maker Lenovo Group failed to hold on to gains after reporting quarterly profit rose 23 per cent on stronger sales of smartphones and other mobile devices, with shares down 1.6 per cent. China Mobile, the world’s biggest wireless carrier by subscribers, rose 0.7 per cent even as the state-owned company reported first half profit fell 8.5 per cent as it continued to roll out fourth-generation phone service.

US cues

Investors are looking ahead to more hints on the health of the global economy with the release of U.S. unemployment benefit applications later Thursday. They come a day after U.S. retail sales edged up a tiny amount compared with the month before, fueling hopes that the Fed will maintain stimulus.

Energy

Benchmark crude oil for September delivery was down 27 cents to $97.31 in electronic trading on the New York Mercantile Exchange. Brent crude, used to price international oils, fell 60 cents to $104.46 in London.

Currencies

The euro rose to $1.3380 from $1.3365 in late trading Thursday. The dollar was little changed at 102.41 yen from 102.42 yen.