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Investors await U.S. data, earnings reports

SEOUL, South Korea - European stocks were lower after most Asian markets abandoned modest gains Thursday ahead of U.S. economic data and corporate earnings reports.

Stock markets are at lofty heights, making investors nervous a corrective sell-off is looming, particularly as the U.S. Federal Reserve edges toward its first interest rate hike since the Great Recession. The Dow Jones industrial average hit yet another record on Wednesday. The strong performance of Wall Street indexes is at odds with the modest growth prospects of the U.S. economy and the same contradiction also prevails in Europe and parts of Asia.

In early European trading, Britain's FTSE 100 was down 0.4 percent to 6,759.68 and France's CAC 40 dipped 0.5 percent to 4,349.28. Germany's DAX fell 0.3 percent to 9,830.25.

U.S markets were also headed for a lukewarm day. Dow Jones futures inched down 0.2 percent and S&P 500 futures dropped 0.4 percent.

For the rest of the week, earnings reports from Google and IBM are key events on the corporate side. Investors had cheered Intel's report of a 40-percent jump in its bottom line, a sign of recovery in PC demand.

The U.S. government is also set to release economic data including unemployment claims and home construction.

Earlier in Asia, most of the region's markets finished in negative territory or were little changed.

Tokyo's Nikkei 225 closed 0.1 percent lower at 15,370.26 and China Shanghai Composite declined 0.6 percent to 2,055.59. Hong Kong's Hang Seng and Sydney's S&P/ASX 200 were little changed.

South Korea was the only major market that finished higher. The Kospi in Seoul rose 0.4 percent to 2,020.90. The market was boosted by expectations that the country's new pro-growth finance minister would introduce measures to ease housing market regulations and encourage domestic spending.

The escalation of the U.S. sanctions against Russia appeared to have no immediate impact on stock markets, although the move hit Russian stocks.

The new rounds of U.S. sanctions targeted two major energy firms, a pair of powerful financial institutions, eight weapons firms and four individuals. The U.S. penalties are meant to increase pressure to end the insurgency in eastern Ukraine believed to be supported by Moscow.

In energy trading, benchmark U.S. crude for August delivery was up 91 cents at $102.11 a barrel in electronic trading on the New York Mercantile Exchange. The contract added $1.24 to settle at $101.20 on Thursday.

In currencies, the euro gained to $1.3535 from $1.3528. The dollar fell to 101.48 yen from 101.65 yen late Wednesday.