Greece standoff weights on world stocks
BEIJING - World stocks were mostly lower for a second day Tuesday, weighed down by Greece's standoff with its creditors that threatens to shake global markets.
France's CAC-40 fell 0.2 percent to 4,641.59 and Germany's DAX dropped 0.5 percent to 10,611.62. Britain's FTSE 100 shed 0.5 percent to 6,805.28. Wall Street looked set for gains after losses Monday. Dow futures were up 0.7 percent and S&P 500 futures added 0.6 percent.
Tensions between Athens and its foreign creditors mounted after Prime Minister Alexis Tsipras on Sunday declared an end to budget cuts and tax increases. Tsipras said he would press for a short-term loan to give the country and its creditors time to negotiate a replacement for its bailout program. Greece is a relatively small economy but investors worry that if it drops out of the euro currency, that might send shock waves through financial markets.
"We think there has not been a sharp downturn in global growth recently, although activity has slowed gradually in China and remains sluggish in Japan and the euro-zone," said Andrew Kenningham of Capital Economics in a report. "But another familiar problem, the fiscal crisis in Greece, clearly poses a significant downside risk to the global economy, even if the threat of contagion has diminished somewhat since 2012."
Tokyo's Nikkei 225 declined 0.3 percent to 17,652.68 while the Shanghai Composite Index rose 1.5 percent to 3,141.59. Seoul's Kospi shed 0.6 percent to 1,935.86 and Sydney and Southeast Asian markets also fell. Hong Kong's Hang Seng was flat at 24,528.10.
Benchmark U.S. crude was down 80 cents to $52.06 per barrel in electronic trading on the New York Mercantile Exchange. The contract added $1.17 on Monday to close at $52.86. Brent crude, used to price international oils, declined 77 cents to $57.58 after adding 54 cents to close at $58.34 on Monday. The gains Monday came as OPEC said that it expects demand for crude to rise this year and U.S. output to fall.
The dollar strengthened to 118.77 yen from Monday's 118.58 yen. The euro declined to $1.1320 from $1.1330.