GLOBAL MARKETS-China data weighs on world stocks, copper
* Copper declines after data from China, the biggest user* Global stocks slip after six days of gainsBy Rodrigo CamposNEW YORK, Oct 13 (Reuters) - Global stocks and copper
prices fell from recent highs on Thursday after weak data from
China reinforced concerns about the global economy, while the
euro dipped on lagging worries over the European debt crisis.The European Central Bank warned about the effect of
bondholder write-downs, and investor unease on the
effectiveness of current measures to prevent the spread of the
euro zone debt crisis could be seen in the rise in yields on
Italian bonds.Major stock markets had recently jumped sharply on hopes
the debt crisis was close to being resolved.Prices of U.S. Treasury debt rose as investors sought
relative safety.On Wall Street, shares of JPMorgan Chase slumped 5.5
percent to $31.39 after the bank reported a drop in quarterly
earnings. It was the first major U.S. bank to post results this
season.U.S. shares fell from three-week highs after China reported
its trade surplus narrowed for a second straight month in
September. Both imports and exports were lower than expected.The data reflected global economic weakness, which along
with the euro zone debt crisis, drove equities and commodities
to post heavy losses in the third quarter.An index of U.S. bank shares slid 4.3 percent.”JPMorgan is a good indicator of what is happening in the
banking industry and a little bit of an insight into where
consumer banking is headed.” said Kim Forrest, senior equity
research analyst at Fort Pitt Capital Group in Pittsburgh.In afternoon trading in New York, the Dow Jones industrial
average dropped 51.50 points, or 0.45 percent, to
11,467.35. The S&P 500 dropped 6.80 points, or 0.56
percent, to 1,200.45. The Nasdaq Composite gained 4.05
points, or 0.16 percent, to 2,608.78.A spike in shares of chipmakers kept the tech-heavy Nasdaq
higher.The S&P 500 has run up more than 10 percent from a 2011 low
hit on Oct. 4 and had notched its largest seven-day rally since
March 2009 on growing optimism European leaders were making
progress in tackling the region’s debt problems.World stocks as measured by MSCI were down
0.5 percent after six days of gains.The soft data from China also pressured copper prices . The industrial metal, often taken as a proxy for
economic growth expectations, fell 2.5 percent. China is the
world’s largest copper consumer, accounting for nearly 40
percent of global demand.The euro pared losses but was still trading lower against
the U.S. dollar, pulling back from a one-month high, after the
ECB warned about the impact on the currency and the region’s
banks of involving bondholders in euro zone bailouts.Slovakia’s parliament backed a plan to bolster the euro
zone’s rescue fund after political parties agreed to hold an
early election, concluding the ratification process in all euro
zone countries.But even with a revamped rescue fund, European banks are
still vulnerable to a Greek default and to sovereign
downgrades. That increases the urgency for them to raise more
capital to remain financially sound, analysts said.”After such a strong rally this week based on nothing but
hope, people realize that things are not going to come as
easily as they had hoped,” said Kathy Lien, director of
currency research at GFT in New York.The single currency hit a New York session low of
$1.3683, according to Reuters data. It last traded at $1.3762,
down 0.2 percent on the day. The euro on Wednesday touched its
highest versus the greenback since Sept. 16.Italy sold 6.2 billion euros of debt, split across four
bonds. But yields remained under pressure, and the European
Central Bank stepped into the secondary market after the
auction, buying Italian debt to cap rising yields.The Italian 10-year BTP yield was up to 5.829
percent from 5.738 percent late on Wednesday.The benchmark 10-year U.S. Treasury note was up 13/32
point, with the yield at 2.1656 percent.Thirty-year bonds gained as much as two points
after a $30 billion auction that saw yields fall below market
forecasts. They last traded up 1-10/32 in price to yield 3.1328
percent.
