European stocks stumble at start of week

Europe's main stock markets slid on Monday, dragged down by a soft opening on Wall Street and data showing that Japan's economy is slowing down. London's benchmark FTSE 100 index of top companies gave up 0.26 percent to 5,831.88 points, while in Paris the CAC 40 slid 0.27 percent to 3,426.41 points and in Frankfurt the DAX 30 dropped 0.50 percent to 6,909.68 points. Milan ended down 0.11 percent while Madrid bucked the trend to gain 0.31 percent. In foreign exchange deals, the European single currency advanced to $1.2340 from $1.2291 in New York late Friday. Official data showing that Japanese economic growth slowed to just 0.3 percent in the second quarter set a gloomy tone to European trading, but many markets later showed modest gains after a successful 8.0-billion-euro Italian government bond auction. "Markets appear to be suffering a post-Olympic hangover as the feel-good factor ... gives way to the economic realities of the global economy," said CMC Markets analyst Michael Hewson. "The lull is expected to be short lived, in a week fairly full of some important economic data from both sides of the Atlantic." The EU, France and Germany release second quarter growth figures on Tuesday. The bounce from the successful Italian bond auction faded as Wall Street opened in the red. In midday trading the blue-chip Dow Jones Industrial Average was down 0.59 percent to 13,130.65 points. The broader S&P 500-stock index lost 0.44 percent to 1,399.74 points, while the tech-rich Nasdaq fell 0.48 percent to 3,006.40 points. "Japan gets less attention these days but is still the world's third-largest economy," noted Dick Green of Briefing.com. Asian stock markets were mostly lower on the Japanese data and as dealers awaited fresh stimulus drives by the central banks of the United States, Europe and China. Hong Kong dropped 0.27 percent, Shanghai shed 1.51 percent and Tokyo edged down 0.07 percent. The Japanese government said that April-June GDP grew 0.3 percent from the previous quarter, sharply weaker than market expectations of a 0.7 percent increase. It also marked a sharp contrast from a brisk 1.3 percent increase in the January-March period. "There are ongoing concerns about slowing global growth as Japan's second-quarter (growth) came in below expectations," said GFT Markets analyst Fawad Razaqzada. "Most investors remain convinced that central banks will respond to any economic slowdown by intervening further." Last week, global stockmarkets enjoyed broad gains on expectations the European Central Bank would restart its bond-buying scheme to support under-pressure economies such as those in Spain and Italy. There were also hopes the US Federal Reserve would unveil fresh stimulus measures while another batch of poor trade figures from China on Friday increased the likelihood Beijing would also intervene to kickstart growth.