World Markets Mixed Despite Wall Street Rebound

World markets were mixed Wednesday, failing to get much impetus from Wall Street's rebound as pervasive concerns about the dismal outlook for the world economy dominated sentiment.

Most Asian stock markets crept higher but major European bourses opened lower and futures pointed to a weak session on Wall Street.

Japan's Nikkei 225 stock average rose 1.8 percent, or 140.41 points, to 8,004.10 and benchmark indexes in Hong Kong, China, Australia, Singapore and India also inched higher as investors nibbled on shares after broad declines the day before.

South Korea bucked the trend with the key index down 0.1 percent and Taiwan's benchmark fell 1.1 percent. Britian's FTSE-100 was down 1 percent, Germany's DAX slipped 2.3 percent and France's CAC-40 retreated 2.2 percent.

"Investors remained cautious due to sustained worries over a prolonged global downturn," said Masatoshi Sato, market analyst at Mizuho Investors Securities Co. Ltd.

In a volatile session Tuesday in New York, the Dow Jones industrial average rose 270 points, or 3.3 percent, to 8,419.09, clawing back some of Monday's 7.7 percent plunge. That decline had sent Asian stocks sharply lower Tuesday.

The U.S. market withstood mixed messages from troubled U.S. automakers. General Motors Corp. said it needs $12 billion in government loans and a $6 billion line of credit, while Chrysler LLC said it needs $7 billion by year's end. Ford Motor Co. asked for a $9 billion "standby line of credit" in case one of its rivals fails.

Worries about the viability of the three companies has weighed on Wall Street and the broader economy in recent weeks amid a debate over whether they should receive government assistance. Futures pointed to a lower open on Wall Street with Dow futures down 132 points, or 1.6 percent, at 8300 and S&P futures off 15.7 points, or 1.9 percent, at 833.30.

Asian automakers were mostly lower Wednesday after U.S. auto sales plunged 37 percent in November to their worst level in more than 26 years. In Tokyo, Toyota Motor Corp. fell 0.9 percent and Honda Motor Corp. slid 4.7 percent. South Korea's Hyundai Motor Co. shed 3 percent and Kia Motors Corp. dropped 1.8 percent.

Shares in Australia pared a 2 percent gain to close almost flat after the Australian government announced the economy slowed to growth of just 0.1 percent in the third quarter, the slowest pace in eight years. Qantas Airways was up 4.4 percent on news of merger talks with British Airways.

CMC Markets Stockbroking general manager Andrew West said a tie-up between the carriers would be a positive move for Qantas, particularly in the currently tough airline market.

"If the deal goes through it will create a formidable airline that has a major share of major routes to the U.S., UK and Asia," he said.

Shares in Thailand rose 1.6 percent after a court ruling Tuesday dissolved the ruling party for electoral fraud, lancing weeks of heightened political tensions that culminated in protesters occupying Bangkok's two airports. The country's central bank also announced its biggest cut to interest rates in eight years.

In currency trading, the Japanese yen stood at 93.25 to the dollar in late afternoon trading, compared with 93.13 yen in New York late Tuesday.

Oil prices rose slightly Wednesday in Asia after hitting a three-year low overnight as investors try to gauge how much the slowing U.S. and Chinese economies will hurt demand for crude.

Light, sweet crude for January delivery was up 84 cents to $47.80 a barrel in electronic trading on the New York Mercantile Exchange by midafternoon in Singapore.

The outlook for China's slowing economy was also weighing on markets in Asia, said Mark Tan of UOB Asset Management in Singapore.

"It's just going to be more bad news," he said, referring to the release of upcoming data such as industrial production and retail sales.

Copyright AP - Associated Press
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