Global stocks slip on China slowdown worries, comments; oil falls
NEW YORK (Reuters) - Concern about a potential economic slowdown in China pressured world stock indexes on Monday while Brent crude oil fell below $97 a barrel on sluggish demand and ample supplies.
Signs of disagreement between major economic powers on the need for extra stimulus further clouded the outlook.
China will not dramatically alter its policy because of any one economic indicator, Finance Minister Lou Jiwei said on Sunday, days after many economists lowered growth forecasts after seeing the latest set of weak data.
Investors worried a closely watched gauge of Chinese manufacturing, due on Tuesday, could indicate activity was contracting.
"With China's statements not defining clear hurdles for stimulus, the market is grappling to guess which data point will tip the hand that controls the purse strings," said Andre Bakhos, managing director at Janlyn Capital LLC in Bernardsville, New Jersey.
The Dow Jones industrial average fell 60.93 points, or 0.35 percent, to 17,218.81, the S&P 500 lost 14.38 points, or 0.72 percent, to 1,996.02 and the Nasdaq Composite dropped 53.23 points, or 1.16 percent, to 4,526.56.
MSCI's global share index was down 0.8 percent, while European shares were down 0.6 percent.
In the U.S. Treasuries market, long-dated yields dipped to their lowest in over a week on the view that lingering weakness in U.S. economic data may force the Federal Reserve to maintain a dovish stance on raising interest rates.
Ten-year U.S. Treasury notes were last up 3/32 in price to yield 2.57 percent, from a yield of 2.59 percent late Friday. U.S. 30-year Treasury bonds added 6/32 to yield 3.29 percent, from a yield of 3.3 percent late Friday. The yield hit a session low of 3.26 percent, its lowest since Sept. 11.
The dollar softened as other major currencies recovered some ground after 10 weeks of gains by the dollar index . The euro , which traded at nearly $1.40 in May, was slightly higher against the dollar at $1.2830 after touching a high of $1.2867.
The Australian dollar , though, fell half a percent to a seven-month low of $0.8826, reflecting Australia's dependency on Chinese appetite for its natural resources exports.
Brent crude oil fell below $97 a barrel, dropping for the third session in four, as sluggish demand and ample supplies outweighed expectations of a cut in oil output from the Organization of the Petroleum Exporting Countries.
November Brent was off $1.50 at $96.89, while U.S. crude futures were down 74 cents at $91.67.
The closely watched Chinese manufacturing number will be released on Tuesday, as will other global flash business activity surveys for September.
Group of 20 finance ministers and central bank chiefs meeting in Australia at the weekend did little to settle investor nerves. They said they were close to adding $2 trillion to the global economy, but there were signs of disagreement.
(Additional reporting by Nigel Stephenson in London and; Michael Connor and Chuck Mikolajczak in New York; Editing by James Dalgleish)