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Stock markets retreat as China data disappoints
Stock markets retreat as China data disappoints
by AFP Staff Writers
London (AFP) Dec 16, 2024

Major stock markets and oil prices retreated Monday after an unexpected slowdown in retail sales reinforced worries about China's struggling economy.

The dollar mostly rose as traders looked ahead to interest-rate decisions this week from the US Federal Reserve, Bank of Japan and Bank of England.

Bitcoin hit a new record high at $106,493.43.

"China remained the central focus for Asian markets in another show of economic weakness which sent markets lower," noted Richard Hunter, head of markets at Interactive Investor.

"The highlight of the week... will be the interest rate decision from the Fed on Wednesday."

Observers also tracked developments in Seoul after South Korean lawmakers impeached President Yoon Suk Yeol at the weekend in the wake of his short-lived declaration of martial law this month.

Hong Kong and Shanghai indices closed lower after figures showed that Chinese retail sales grew 3.0 percent last month, much slower than October and well off the five-percent forecast.

The figures highlighted the work China's leaders had in store as they try to kickstart consumption and reignite the world's number two economy.

Officials unveiled new promises at the weekend to boost the battered property sector and tweak monitoring of equity markets.

That came after investors were left unimpressed last week with Beijing's pledge to introduce measures aimed at "lifting consumption vigorously" as part of a stimulus drive.

- France downgrade -

In Europe, the Paris stock market dropped after Moody's downgraded France's credit rating Saturday, following months of political crisis and the appointment of centrist Francois Bayrou as prime minister.

European Central Bank chief Christine Lagarde on Monday said eurozone policymakers would keep lowering interest rates and warned that higher US tariffs under President-elect Donald Trump could hit growth in the bloc.

The ECB cut rates again last week as inflation looked to be coming under control and the eurozone economy showed signs of weakness.

The Fed is widely expected to cut interest rates again Wednesday but there are fears it will have to slow its pace of easing next year owing to sticky inflation and bets that Trump's tax cuts and tariffs will reignite prices.

On the corporate front, three spinoffs from French right-wing tycoon Vincent Bollore's Vivendi media empire debuted on stock markets, with mixed results.

Shares in the Canal+ television and film group tanked 15 percent in London.

The other two spinoffs had a better start: Book publisher Louis Hachette soared 25 percent on the Euronext Growth in Paris while advertising agency Havas was up six percent in Amsterdam.

Shares rose in the remaining Vivendi company, which stayed on the Paris stock exchange.

Elsewhere, Britain's centuries-old Royal Mail is set to pass into foreign ownership after the UK government approved the takeover of its parent company by Czech billionaire Daniel Kretinsky's EP Group.

The takeover of International Distribution Services is worth �3.6 billion ($4.5 billion). IDS shares climbed nearly one percent in late morning deals.

- Key figures around 1115 GMT -

Paris - CAC 40: DOWN 0.9 percent at 7,345.84 points

Frankfurt - DAX: DOWN 0.4 percent at 20,329.16

London - FTSE 100: DOWN 0.4 percent at 8,267.15

Tokyo - Nikkei 225: FLAT at 39,457.49 (close)

Hong Kong - Hang Seng Index: DOWN 0.9 percent at 19,795.49 (close)

Shanghai - Composite: DOWN 0.2 percent at 3,386.33 (close)

New York - Dow: DOWN 0.2 percent at 43,828.06 (close)

Euro/dollar: DOWN at $1.0490 from $1.0504 on Friday

Pound/dollar: UP at $1.2646 from $1.2622

Dollar/yen: UP at 153.83 yen from 153.60 yen

Euro/pound: DOWN at 82.94 pence from 83.19 pence

West Texas Intermediate: DOWN 1.2 percent at $70.45 per barrel

Brent North Sea Crude: DOWN 1.0 percent at $73.77 per barrel

dan-bcp/ajb/lth

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INDEX CORP.

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