Markets cautious ahead of key week for Greece
LONDON — World stock markets fluctuated in lackluster trading Monday, as investors remained cautious ahead of a crucial week for Greek leaders as they try to show they are making progress in implementing reforms and austerity measures.
In early European trading, the FTSE-100 index of leading British companies edged 0.2 percent lower to 5,843.08 while Germany’s DAX was up 0.4 percent at 7,066.17. France’s CAC-40 was almost 0.1 percent higher at 3,488.86.
Wall Street was poised to open flat — both Dow and S&P 500 futures were flat — while Asian markets closed lower.
Investors this week are watching Greek Prime Minister Antonis Samaras’ visit to Germany and France, where he is expected to ask for an extension on Greece’s deadline to meet fiscal targets as it carries out painful reforms. Luxembourg Prime Minister Jean-Claude Juncker, who chairs the eurozone finance ministers’ meetings, will be in Athens on Wednesday to meet Samaras.
A senior German politician said over the weekend that Greece doesn’t have any wiggle room, darkening investors’ mood over Europe’s simmering debt crisis. There’s also little chance of Germany’s governing coalition supporting a third rescue package, Volker Kauder, a senior ally of Chancellor Angela Merkel, was quoted by Der Spiegel as saying.
Ahead of Samaras’ meetings, Greece’s finance officials were trying on Monday to finalize (euro) 11.5 billion in budget savings necessary for the country to continue receiving its bailout funds. Greece’s debt inspectors will issue a report next month on whether the country is doing enough to cut its debt.
Earlier, the Shanghai Composite Index dropped 0.4 percent to close at 2,106.96, the lowest level since early 2009 as investors continue to be cautious about the world’s second largest economy amid mounting signs of a slowdown. The smaller Shenzhen Composite Index gained 0.3 percent to 879.25. Agriculture, biotechnology and food companies led gains while insurance, real estate and engineering companies dropped.
A report over the weekend that property prices in July rose slightly indicated the property market was benefiting from recent interest rate cuts, analysts said. But investors were still downbeat about prospects for further big stimulus measures, which are often announced on weekends or holidays.
“Every weekend investors are expecting the (Chinese) central government would throw out polices and every Monday comes in and there are no policies,” said Jackson Wong, a vice president at Tanrich Securities. “That disappoints investors in general.”
Elsewhere in Asia, Japan’s Nikkei 225 index rose 0.1 percent to close at 9,171.16 while South Korea’s Kospi was practically unchanged to end at 1,946.31. Hong Kong’s Hang Seng shed 0.1 percent to 20,104.27.
Crude oil futures were down 1 cent to $96.00 per barrel in electronic trading on the New York Mercantile Exchange. The contract rose 41 cents to finish at $96.01 per barrel in New York on Friday.
In currencies, the euro was trading at $1.2325, about unchanged from late Friday in New York. The dollar was steady at 79.55 yen.
Kelvin Chan in Hong Kong contributed to this report.