Stocks down ahead of US economic data

James PHEBY
 

Global stock markets were generally weaker on Friday as investors awaited the release of fresh economic data from the US, while stocks prices in London faced pressure from South Africa's political turmoil.

On Wall Street, the Dow Jones index fell at the start of trade with investors' attention focussing on release of inflation, consumer conficence and other economic data.

In Europe, London stocks were down by around 0.4 percent in mid-afternoon trade, with South Africa-exposed companies sliding after President Jacob Zuma sacked his respected finance minister.

Frankfurt and Paris stocks were little changed, despite news of a sharp slowdown in eurozone inflation, which dampened the chances of a European Central Bank interest rate hike any time soon, dealers said.

European markets' gains were also capped as investors positioned themselves and closed their books on the final day of the quarter of 2017.

In London, investors digested unrevised data, which showed the British economy expanded by 0.7 percent in the final three months of last year despite jitters over Brexit.

In currency deals, South Africa's rand plunged after Zuma sacked finance minister Pravin Gordhan.

The news also sent shares in miner Anglo American (LSE: AAL.L - news) down by as muc as 3.8 percent, while finance group Old Mutual (Other OTC: ODMUF - news) topped the fallers' board with a 7.5-percent tumble.

"Stocks with exposure to South Africa plunged amid deep fears about the state of the country's government following the sacking of respected finance minister Pravin Gordhan," said Neil Wilson, analyst with ETX Capital.

"Equities appear to be bearing the brunt of the market's concern today. Interestingly we've not seen massive moves in the rand.

"It's lower against the dollar for sure -- but the fall was not as much as we might have expected."

Miners were also hit by softer metal prices, with Antofagasta (Other OTC: ANFGF - news) down 2.3 percent, BHP Billiton (NYSE: BBL - news) shedding 2.8 percent and Rio Tinto (Hanover: CRA1.HA - news) losing 2.9 percent.

- Rand fall -

The dollar surged five percent against the rand after the sacking of Gordhan, who had enjoyed the support of many international investors and had campaigned for budget discipline.

The rand languished at two-month dollar lows in late morning European deals.

Gordhan was also widely admired by ordinary South Africans and veterans of the anti-apartheid struggle and there are fears his removal -- along with several top cabinet members -- could precipitate a split in the ruling African National Congress, the party of Nelson Mandela.

The decision comes as the government struggles to get a grip on the once-booming economy of South Africa, one of the continent's biggest and part of the so-called BRICS grouping that includes China.

- Key figures at 1400 GMT -

New York - Dow: DOWN 0.2 percent at 20,685.81 points

London - FTSE 100: DOWN 0.4 percent at 7,341.14

Frankfurt - DAX 30: UP 0.04 percent at 12,261.52

Paris - CAC 40: DOWN 0.04 percent at 5,087.61

EURO STOXX 50: DOWN 0.07 percent at 3,479.24

Tokyo - Nikkei 225: DOWN 0.8 percent at 18,909.26 (close)

Hong Kong - Hang Seng: DOWN 0.8 percent at 24,111.59 (close)

Shanghai - Composite: UP 0.4 percent at 3,222.51 (close)

Euro/dollar: DOWN at $1.0681 from $1.0694

Pound/dollar: UP at $1.2465 from $1.2450

Dollar/yen: DOWN at 111.70 yen from 111.84 yen

Oil - West Texas Intermediate: DOWN nine cents at $50.26 per barrel

Oil - Brent North Sea: UP 13 cents at $53.26

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