European stock markets drifted lower Friday on the first trading day of the New Year as investors fretted over the state of the economic recovery in the 19-country eurozone, a further fall in the price of oil and the upcoming election in Greece. The euro was in retreat too after European Central Bank President Mario Draghi indicated the bank could soon back a further monetary stimulus. In Europe, France's CAC 40 fell 0.4 percent to 4,258 while Germany's DAX fell 0.6 percent to 9,748. The FTSE 100 index of leading British shares was down 0.4 percent at 6,541. Wall Street was set for gains, however, with Dow futures and the broader S&P 500 futures up 0.3 percent.
Traders in Europe have a number of concerns as 2015 begins. As well as worrying about anemic levels of economic growth in the eurozone and lower oil prices, traders are concerned that the election in Greece on Jan. 25 may reignite the country's debt crisis if anti-austerity parties form the next government, as current opinion polls suggest. "Fears that a considerably more anti-austerity party will take over from (Greek) Prime Minister Antonis Samaras and disrupt the fragile stability that currently exists around Europe look to be giving investors a more cautious trading mindset," said Alastair McCaig, market analyst at IG. Wall Street traders are set for a busy return when the Institute for Supply Management publishes its closely monitored manufacturing report. The prevailing view in the markets is that the U.S. economy will start 2015 where it left off outperforming its peers. "Leading from the front and setting a more optimistic outlook is something the U.S. spent much of 2014 doing," said McCaig. Hong Kong's Hang Seng rose 1.1 percent to 23,857.82 and South Korea's Kospi added 0.6 percent to 1,926.44. Australia's S&P/ASX 200 gained 0.5 percent to 5,435.90. India's Sensex jumped 1.5 percent to 27,915.44. Markets in several countries including Japan and China were closed for New Year holidays.
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