Asian stock markets turn mixed amid US economic weakness; European shares fall

Asian stocks mixed amid US weakness; Europe down

HONG KONG — Asian stock markets turned in a mixed performance Thursday as signs of weakness in the U.S. economy aggravated worries about the strength of the global recovery. European markets fell in early trade.

It was the second day of middling trade in Asia and followed modest losses on Wall Street. Oil and gold prices were down slightly, while the dollar fell against the yen and rose against the euro.

A recent rally that’s lifted several Asian benchmarks to new highs this month lost more steam after an unexpected drop in U.S. home building added to concerns a turnaround in the world’s largest economy will be tepid at best.

Also weighing on investors in Asia was news Japan’s Mitsubishi UFJ Financial Group, the country’s biggest bank, was seeking to raise some $11.2 billion to shore up its balance sheet. It was more evidence the financial sector has still not fully healed more than a year after the crisis’ onset.

Daniel McCormack, a strategist for Macquarie Securities in Hong Kong, said the economic gloom was dulling the effects of easy money worldwide that has helped inflate stock prices this year.

“On one hand you’ve got fundamentals working against you. On the other hand you’ve got liquidity supporting the markets,” McCormack said. “The fundamentals are weakening, so I think things will drift sideways or lower.”

European markets were similarly lackluster, with Britain’s FTSE 100 losing 0.2 percent, Germany’s DAX off 0.2 percent and France’s CAC-40 shedding 0.4 percent. Wall Street futures suggested a lower open Thursday. S&P futures were off 6, or 0.5 percent, at 1,102.60 and Dow futures fell 50, or 0.5 percent, to 10,354.

Earlier in Asia, Japan’s Nikkei 225 stock average lost 127.33 points, or 1.3 percent, to 9,549.47 — its seventh straight day of decline as investors succumbed to jitters about a possible glut of new bank shares after Mitsubishi UFJ announced its capital raising plans. The bank’s shares fell 3.7 percent.

Elsewhere, Hong Kong’s Hang Seng fell 197.17 points, or 0.9 percent, to 22,643.16. India’s key index was down 1.3 percent, Taiwan’s benchmark shed 0.1 percent and Indonesia’s market was 0.6 percent lower.

Other markets fared better: South Korea’s Kospi added 1 percent to lead the region and China’s Shanghai index rose 0.5 percent.

In Singapore, shares were up 0.6 percent after the city-state reported a second straight quarter of growth as manufacturing and service sectors helped it surface from a deep recession. The economy was seen expanding between 3 percent and 5 percent next year, the government said.

Overnight in the U.S., the Dow fell 11.11, or 0.1 percent, to 10,426.31, after sliding as much as 77 points in morning trading.

The broader S&P 500 index slipped 0.52, or 0.1 percent, to 1,109.80, while the Nasdaq fell 10.64, or 0.5 percent, to 2,193.14.

Oil prices hovered above $79 a barrel in Asia, with benchmark crude for December delivery down 44 cents to $79.14 a barrel. The contract rose 44 cents to settle at $79.58 on Wednesday.

Gold prices eased after a strong run, losing $2.94, or 0.3 percent, to $1,137.76.

The dollar fell to 89.11 yen from 89.34 yen. The euro was lower at $1.4875 from $1.4961.