Global stocks edge lower after series of gains

ASSOCIATED PRESS
BEIJING
Published 23.11.2015 20:59

Global stocks were mostly lower yesterday as momentum faded from a week of strong gains on Wall Street. In Europe, France's CAC-40 shed 0.6 percent to 4,879.34 after a survey showed economic activity had dropped in the wake of the Paris attacks. Germany's DAX declined 0.2 percent to 11,093.68, while Britain's FTSE 100 fell 0.4 percent to 6,309.33. Futures pointed to small losses on Wall Street. Dow futures and S&P 500 futures both shed 0.1 percent. Last week, U.S. stocks recorded their best week this year on gains by retailers and technology companies as investors put jitters about the Paris attacks behind them.

Investors have gradually gotten used to the idea that the Federal Reserve is preparing to raise interest rates at its December meeting from record-low levels. They had been concerned, because higher rates can depress stock prices. But investors appear to have come around to seeing a possible hike as a positive sign that the Fed believes the economy is on solid footing.

"The market is looking beyond the first rate hike and focusing on Fed's reiteration that the pace of rate normalization is going to be gradual, very, very gradual," said IG analyst Bernard Aw in a report. Minutes from Fed meetings "have hinted that the pace will be much slower than that of previous rate hike cycles," he said. "In that regard, despite the Fed potentially raising rates in December, it will still be considered as dovish," said Aw.

A closely watched survey showed that economic activity across the 19-country eurozone accelerated to a four-and-a-half-year high in November. Among the countries, France saw a decrease in the wake of the Paris attacks, according to survey compiler Markit. Economists say that previous attacks by extremists on major cities suggest the impact of this month's events on France's economy is likely to be short-lived.

Investors will monitor the share prices of Pfizer and Allergan, which confirmed Monday that they will join in a $160 billion deal to create the world's largest drugmaker. The transaction is valued at $363.63 per Allergan share. Allergan shareholders will receive 11.3 shares of the combined company for each of their shares. Pfizer stockholders get one share of the combined company for each of theirs.

The Shanghai Composite Index lost 0.6 percent to 3,610.31 while South Korea's Kospi rose 0.7 percent to 2,003.70. Hong Kong's Hang Seng was off 0.4 percent and Australia's S&P/ASX 200 added 0.4 percent to 5,276.40. Japanese markets were closed for a holiday. Benchmarks in Taiwan, Bangkok and Manila advanced. Singapore and Jakarta retreated.

Benchmark U.S. crude was down 1.1 percent to $41.47 per barrel in electronic trading on the New York Mercantile Exchange. The contract gained 18 cents on Friday to close at $41.90. The dollar rose to 123.10 yen from 122.79 yen. The euro fell to $1.0635 from $1.0649.

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