World markets struggle as Fed lift fades

AP News
Posted: Jun 20, 2014 7:17 AM

HONG KONG (AP) — World stock markets struggled Friday as the euphoria faded from the Fed's promises of prolonged low rates to boost growth.

Markets were subdued in lackluster trading, with Japanese and Australian benchmarks moving lower after big gains the previous day.

The fluctuations reflect investors' cautious mood heading into summer plus lingering concern over the possible widening of the turmoil in Iraq and uncertainty about the U.S. economy's resilience.

Markets got an earlier boost from Federal Reserve Chair Janet Yellen's pledge this week that short-term rates would not rise from record lows anytime soon.

"Both U.S. and Asian markets have been much more subdued after the FOMC meeting and it seems that once the dust settles the big moves in a number of assets were predominantly based on position re-adjustment than anything else," said Chris Weston of IG Markets in Melbourne.

In early European trading, France's CAC 40 edged up 0.1 percent to 4,568.23 while Germany's DAX added 0.3 percent to 10,034.56. The FTSE 100 index of leading British companies gained 0.3 percent to 6,829.91.

U.S. stocks were poised for a flat opening, with Dow futures up 0.1 percent to 16,843.00 and broader S&P 500 futures up 0.1 percent to 1,951.40.

Japan's benchmark Nikkei 225 dipped 0.1 percent to close at 15,349.42 while Australia's S&P/ASX 200 tumbled 0.9 percent to 5,419.50. Both had jumped 1.6 percent in Thursday's session.

South Korea's Kospi lost 1.2 percent to 1,968.07 while Hong Kong's Hang Seng edged 0.1 percent higher to 23,194.06 and the Shanghai Composite Index in mainland China added 0.1 percent to 2,026.67.

In energy trading, the price of U.S. benchmark crude for August delivery rose 2 cents to $106.07 per barrel in electronic trading on the New York Mercantile Exchange.

In currencies, the dollar rose to 102.03 Japanese yen from 101.93 in late trading Thursday. The euro slipped to $1.3602 from $1.3612.