Paris - AFP
Global stock markets were mostly lower on Tuesday after figures showed the eurozone economy slumping to a virtual halt, prompting nervous investors to take quick profits in volatile trade. Dealers said weak US housing data added to the negative tone, dampening hopes that a meeting between French President Nicolas Sarkozy and German Chancellor Angela Merkel can come up with anything to steady sentiment after the past month\'s wild rollercoaster ride. \"It would be better not to meet than to meet and not have anything useful to say,\" commented Sony Kapoor of Re-Define, an economic think-tank, ahead of a planned 1630 GMT press conference by the two leaders. In New York, the blue-chip Dow Jones Industrial Average was off 0.29 percent at around 1600 GMT with the tech-rich Nasdaq Composite down 0.69 percent. Dealers there said investors took quick profits on gains made in the past few days as the markets bounced back from some of the worst losses seen since the onset of the global financial crisis in 2008. News that Fitch Ratings confirmed its top US credit rating was welcome after peer Standard and Poor\'s cut its assessment but it had little immediate impact. In London, the FTSE 100 index of leading companies closed up 0.13 percent to 5,357.63 points while in Frankfurt, the main DAX index fell 0.45 percent to 5,994.90 points and the Paris CAC 40 shed 0.25 percent to 3,230.90 points. Elsewhere Madrid lost 0.40 and Milan fell 0.87 percent but Swiss stocks gained 0.97 percent. The euro slipped to $1.4424 from $1.4440 late in New York on Monday. Gold was at around $1,779 an ounce, up sharply from $1,739 late Monday as investors bought back into the traditional safe-haven asset. In Asian trade earlier Tuesday, markets were mostly lower despite sharp gains overnight in New York. Tokyo added 0.23 percent and Seoul jumped 4.83 percent but Hong Kong lost 0.24 percent, Shanghai was down 0.71 percent, Sydney shed 0.86 percent and Mumbai ended 0.65 percent down. While London and Zurich were the only majors to close in positive territory, the European markets all came back from sharp early losses after disastrous eurozone figures showing the economy stalled in the second quarter. The eurozone economy slumped to just 0.2 percent growth in the second quarter from 0.8 percent in the first and short of forecasts for 0.3 percent. Even more shocking was the slump in the Germany, Europe\'s powerhouse economy, to just 0.1 percent from 1.3 percent in the first three months. Analysts said governments were now in the worst of both worlds, trying to cut debt by slashing spending and raising taxes, a double squeeze which kills growth and makes stabilising the public finances even more difficult. \"The news is not good and the markets will look at German weakness as a sign that the necessary financial ammunition is not there to keep\" the eurozone afloat, said Stephen Gallo, head of market analysis at Schneider Foreign Exchange in London. \"Perhaps ... this recent sign of weakness in Germany will lead to a more urgent feeling on the part of the German government that something needs to be done, and very soon at that. \"The financial stability of the euro area is at risk and the euro is the life blood of Germany\'s economic success,\" Gallo said. \"The euro area is caught in a self-inflicted low-growth, low-confidence trap,\" Kapoor said. \"Further deterioration in the economy and more near-death experiences may make even the most sceptical of EU leaders reconsider their stance on eurobonds,\" he said. German and French officials made it clear before the Paris Sarkozy-Merkel meeting that issuing eurobonds -- to ease the pressure on weaker member states -- was definitely not on the agenda. CMC Markets analyst Michael Hewson said he thought any progress at the meeting was \"highly unlikely, given that one of the solutions that could assuage investor concerns has been ruled out by both Germany and France.\" The idea of eurobonds issued and guaranteed by countries with better credit ratings has long been floated as a way of helping struggling eurozone members raise money on the markets at affordable interest rates. Germany opposes eurobonds as it believes it would increase its own borrowing costs and allow countries to duck badly needed fiscal reforms.