AP and AFP
HONG KONG–World stocks sank Monday as Greece inched closer to default after weekend talks with international creditors over freeing up the rest of its bailout funds went nowhere. Chinese shares led declines in Asia after regulators tightened up on lending by brokerages to investors.
European stocks opened lower, with France’s CAC-40 shedding 1.1 percent to 4,848.38. Germany’s DAX dropped 1.2 percent to 11,060.61 and the UK’s FTSE 100 lost 0.6 percent to 6,743.62. U.S. stocks were poised to open lower. Dow futures down 0.4 percent to 17,750.00. Broader S&P 500 futures slid 0.7 percent to 2,077.20.
Weekend negotiations on Greece’s bailout terms produced no breakthroughs and Greek officials and creditors remained far apart as a deadline for a debt payment nears. Greek leaders want to get access to the final 7.2 billion euros (US$8.2 billion) of the 240 billion euro bailout that’s needed to repay debts and avoid a possible default that could trigger an exit from the euro; the bailout package expires at the end of the month. But investors are growing nervous at signs of scant progress in talks with creditors, including eurozone states, the European Central Bank and the International Monetary Fund, on new economic reforms required before the money is doled out.
��We have always argued that a Greek deal would only occur at one minute to midnight,�� Michael Every, Rabobank’s head of Asia-Pacific financial market research, wrote in a commentary. ��Yet it now looks like 23:58 and counting.��
Tokyo stocks edged down 0.09 percent. The Nikkei 225 index at the Tokyo Stock Exchange lost 19.29 points to close at 20,387.79, while the broader Topix index of all first-section shares inched up 0.03 percent, or 0.44 points, to 1,651.92. In share trading, Honda fell 0.65 percent to 4,075 yen after it reported a new death linked to an exploding air bag crisis, which sparked the recall of millions of vehicles. Market heavyweight Fast Retailing, operator of the Uniqlo clothing chain, inched down 0.05 percent to 52,740 yen while Toyota rose 0.18 percent to 8,409 yen. Hong Kong stocks fell 1.53 percent. The benchmark Hang Seng Index lost 418.73 points to close at 26,861.81 on turnover of HK$116.51 billion (US$15.03 billion). Shanghai lost 2.00 percent. In mainland China the benchmark Shanghai Composite Index dropped 103.36 points to 5,062.99 on turnover of 1.1 trillion yuan (US$179.8 billion). The Shenzhen Composite Index, which tracks stocks on China’s second exchange, fell 2.15 percent, or 67.59 points, to 3,073.07 on turnover of 930.0 billion yuan. Sydney fell 0.12 percent, or 6.45 points, to 5,538.8 and Seoul lost 0.48 percent, or 9.85 points, to end at 2,042.32. In Seoul, dealers are growing concerned about a Middle East Respiratory Syndrome (MERS) outbreak that has now killed 16 people and infected 150. Gold fetched US$1,175.37 compared with US$1,179.90 late Friday.