Updated: 13/08/12 : 09:30:39Printable Version
European stocks edged lower today, hurt by further signs of a slowdown in global economic growth, although expectations of central bank action to boost ailing economies looked set to keep any losses in check. Data on Monday showed that Japan's economy expanded just 0.3 percent in April-June, half the pace expected, sparking worries over the strength of the recovery as a rebound in consumer spending loses momentum and Europe's debt crisis weighs on worldwide demand.
The FTSEurofirst 300 was down 0.2 percent at 1,097.38 by 0703 GMT, having slipped 0.1 percent on Friday when soft Chinese economic data prompted investors to take a breather after a two-week rally which saw the index surge 8 percent. Late on Friday, the president of the San Francisco Federal Reserve, John Williams, said the Fed should launch a fresh round of bond-buying to lower the U.S. unemployment rate more quickly, fuelling speculation that the central bank could soon unveil a new round of quantitative easing.
"Markets continue to go with the idea that loosening policy will be good news for the economic outlook and for investor sentiment and that will continue to drive markets," Henk Potts, equity strategist at Barclays Wealth, said. "So far we have seen intervention providing a short-term boost, but there's a bigger question over its long-term effectiveness." ( C) Reuters