BANGKOK -- A loss of momentum on Wall Street, dropping commodity prices and worries over Europe's debt problems caused world stock markets to sag Monday.
In early European trading, Britain's FTSE 100 lost 0.2% to 5,915.70 and Germany's DAX was down 0.6% to 7,358.25. France's CAC-40 withered 0.9% as the country reeled from the arrest of prominent political figure and International Monetary Fund head Dominique Strauss-Kahn in New York for alleged sexual offences.
Wall Street was headed for a lower opening, with Dow Jones Industrial Average futures slipping 24 points to 12,532 and S&P 500 futures losing 3.2 points to 1,330.80.
Doubts about the strength of the U.S. economic recovery have weighed on Wall Street and markets elsewhere recently. After sailing through their best first quarter since 1998, U.S. stocks are starting to lose some momentum.The Standard and Poor's 500 stock index, a broad market benchmark, is up just 1% this quarter after jumping 5.4% in the first three months of the year. That weaker performance is in large part because of conflicting data about the health of the U.S. economy. Sluggishness on Wall Street was a sign that "investors continued to worry about slowing global growth and European debt concerns," said Ben Potter of IG Markets in Melbourne. Meanwhile, the arrest Saturday of Strauss-Kahn on attempted rape and sexual assault charges might prove a distraction in Europe, where the IMF and Strauss-Kahn have been heavily involved in trying to resolve debt crises in Portugal and Greece, said Jackson Wong, vice president at Tanrich Securities in Hong Kong. A member of France's Socialist party, Strauss-Kahn was also widely considered the strongest potential challenger next year to President Nicolas Sarkozy, whose political fortunes have been flagging. Japan's Nikkei 225 index dropped 0.9% to close at 9,558.30 with banking shares incurring losses following comments last week by Chief Cabinet Secretary Yukio Edano suggesting that Tokyo Electric Power will need help repaying its debts. Mitsubishi UFJ Financial Group (MTU) lost 1%. Mizuho Financial Group (MFG) and Sumitomo Mitsui Financial both lost 1.5%. Tepco itself plummeted 7.3%. Edano said Friday that Tepco may need adjustments to its loans to help it cope with financial losses incurred following twin natural disasters on March 11 -- an earthquake and subsequent tsunami that smashed into one of the company's nuclear plants in northeastern Japan.