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World Stocks Muted Ahead of Weekend G20 Meeting

Published: February 24, 2012 | 9:55 am
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World stock markets posted mostly small gains Friday amid investor caution over Europe’s debt woes ahead of a Group of 20 meeting over the weekend and as oil prices rose to a new nine-month high.

Crude climbed above $108 a barrel and the dollar weakened against the euro but rose against the yen.

In early European trading, Germany’s DAX rose 0.6 percent to 6,851.54 and the CAC-40 in France was up 0.2 percent at 3,453.95. The FTSE 100 index of leading British shares rose less than 0.1 percent to 5,938.86.

U.S. stocks were poised to rise. Dow futures were up 0.1 percent at 12,987 while broader S&P 500 futures gained 0.1 percent to 1,365.

Japan’s Nikkei 225 climbed 0.5 percent to close at 9,647.38 and South Korea’s Kospi added 0.6 percent to 2,019.89. Hong Kong’s Hang Seng rose 0.1 percent to close at 21,406.86. Benchmarks in Australia, Taiwan, Singapore and New Zealand were also higher.

Mainland Chinese shares were boosted by speculation local governments would relax restrictions on the property market and monetary authorities would tweak policy to stimulate growth.

The benchmark Shanghai Composite Index climbed 1.2 percent to 2,439.63, its highest close in more than 3 months. The smaller Shenzhen Composite Index gained 1.4 percent to 972.62. Shares in real estate, cement and coal minters led the advance.

“There will be some rallying in the short term,” said Li Jianfeng, an analyst at Caida Securities in Shanghai.

China’s second-largest listed property developer, Poly Real Estate gained 3.5 percent and industry leader China Vanke gained 3.9 percent.

Investors in Asia were cautious ahead of a meeting of G-20 finance ministers and central bank governors scheduled for the weekend. While the meeting will focus on promoting global economic stability and growth, investors are wondering if talk will turn to Europe’s debt crisis.

“Europe isn’t supposed to be on the agenda of the G-20 per se as far as bailouts and everything else goes, but you’ve got to imagine there’ll be discussions,” said Andrew Sullivan, principal sales trader at Piper Jaffray Asia Securities. “I think people are still aware that there is the potential for this thing still to blow up.”

In Hong Kong, investors held back ahead of a earnings results from some big banks and property developers next week that would give investors guidance about profits at other blue chip stocks.

Fears over the price of crude oil — driven higher by tensions over Iran and the weakening dollar — kept Asian markets in check because of worries it could crimp the U.S. economic recovery.

Benchmark crude for April delivery was up 66 cents to $108.49 in electronic trading on the New York Mercantile Exchange. The contract advanced $1.55, or 1.5 percent, to settle at $107.83 on Thursday.

In currencies, the euro strengthened to $1.3381 from $1.3337 late Thursday in New York. The dollar rose to 80.57 Japanese yen from 80.08 yen.


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