World stock markets stabilize after strong US industry report offsets concerns over China, Fed

The Associated Press

A man reflected on the electronic board of a securities firm in Tokyo,Tuesday, Feb. 18, 2014. Japan led Asian stock markets higher Tuesday after the country's central bank announced new measures to support growth.(AP Photo/Koji Sasahara)

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The Associated Press

LONDON (AP) — Stock markets recovered somewhat on Thursday after a survey showing a strong increase in U.S. manufacturing eased concerns over a drop in China's own industrial activity.

Manufacturing in the U.S. grew at the fastest rate in almost four years in February, according to a private survey by Markit. That soothed investor nerves after equivalent surveys in China and Europe disappointed. China's fell to a seven-month low, while Europe's showed a steady but slow pace of growth.

The Chinese data "suggests that conditions in the manufacturing sector continue to deteriorate," said Julian Evans-Pritchard, economist at Capital Economics.

In Europe, Germany's DAX fell 0.4 percent to close at 9,618.85. Britain's FTSE 100 rose 0.2 percent to 6,812.99 and France's CAC 40 gained 0.3 percent to 4,355.49.

Wall Street edged up, with the Dow up 0.4 percent at 16,110.85 and the S&P 500 up the same rate at 1,835.11.

Earlier in Asia, markets had closed lower due to the weak Chinese data and concerns that the U.S. Federal Reserve might raise interest rates earlier than expected. Minutes of the Fed's last meeting, released the day before, showed some policymakers had raised the possibility that it might be appropriate to increase the main rate relatively soon.

That came as an unwelcome surprise to many investors, who haven't had to worry about increases in the Federal Reserve's benchmark short-term interest rate for about five years.

Hong Kong's Hang Seng closed 1.2 percent lower at 22,394.08 and Japan's Nikkei 225 shed 2.2 percent to 14,449.18. South Korea's Kospi fell 0.6 percent to 1,930.57.

Stocks were down in Taiwan, Thailand and Singapore while benchmarks in Indonesia and Australia had marginal gains. After trading in positive territory, China's Shanghai Composite edged down 0.2 percent to 2,138.78.

In energy market, benchmark U.S. oil for March delivery was down 24 cents to $102.59 a barrel in electronic trading on the New York Mercantile Exchange. The contract gained 74 cents to $102.84 on Wednesday,

In currencies, the euro edged down 0.2 percent to $1.3701. The dollar was down 0.4 percent 101.84 yen.

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