World stocks drop on China economy jitters

TERESA CEROJANO

MANILA, Philippines (AP) — World stock markets mostly fell Monday after a slower increase in Chinese property prices added to jitters about the strength of the world's No. 2 economy.

In early European trading, Britain's FTSE 100 shed 0.3 percent to 6,818.70 and Germany's DAX fell 0.1 percent at 9,644.10. France's CAC-40 was little changed at 4,382.10.

Futures augured moderate gains on Wall Street. Dow and S&P 500 futures were both up 0.1 percent.

In China's 70 biggest cities, average price increases in January for new housing were down 0.7 percentage points from December's rise, while that for secondhand homes declined by 0.4 percentage points. Year-on-year price increases remain substantial, however, at over 20 percent for the eight cities with fastest growth in prices.

Still, the figures sparked a sell-off in mainland developer shares and come on top of a HSBC survey last week that showed a second straight month of contraction in China's manufacturing. An official manufacturing survey is due later this week.

"There will be plenty of nerves that this release could also disappoint," said Stan Shamu, strategist at IG Markets in Melbourne, Australia.

China's Shanghai Composite Index finished down 1.7 percent at 2,077.23 and Hong Kong's Hang Seng shed 0.8 percent to 22,388.56. Japan's Nikkei 225 stock average fell 0.2 percent to 14,837.68.

Elsewhere in Asia, South Korea's Kospi dropped 0.5 percent to 1,949.05 while Australia's S&P/ASX 200 recovered from early losses, closing in the green but nearly unchanged at 5,440.20. Markets also rose in Singapore and New Zealand.

Benchmark U.S. oil for April delivery was up 23 cents at $102.43 in electronic trading on the New York Mercantile Exchange. The contract fell 55 cents on Friday to close at $102.20.

In currencies, the euro rose to $1.3762 from $1.3729 late Friday. The dollar dropped to 102.36 yen from 102.50 yen late Friday.