PAN PYLASLONDON (AP) ¿ European and U.S. stock markets fell Thursday after disappointing U.S. jobless claims data offset any cheer generated by upbeat earnings from technology firm Apple Inc. and Swiss bank Credit Suisse AG. The FTSE 100 index of leading British shares closed down 12.43 points, or 0.3 percent, at 4,018.23, while France's CAC-40 fell 16.62 points, or 0.6 percent, to 3,008.62. Germany's DAX was 56.21 points, or 1.2 percent, lower at 4,538.21. In the U.S., the Dow Jones industrial average was down 74.55 points, or 1 percent, at 7,812.02, while the broader Standard & Poor's 500 index fell 7.21 points, or 0.9 percent, to 836.34. Optimism in the markets had been elevated in the run-up to the U.S. open by the news that iPhone sales helped lift first quarter profit at Apple by a higher than anticipated 15 percent, but that dried up after the Labor Department reported that new U.S. jobless claims rose to 640,000 last week, above analysts' expectations of 635,000. Corporate news elsewhere in the U.S. was mixed. Though eBay Inc., defense contractor Raytheon Co. and PNC Financial Services, did better than expected, UPS Inc., the world's largest shipping carrier, and cigarette maker Philip Morris International Inc. delivered lower than anticipated earnings.
Investors will also be bracing themselves for Microsoft Corp.'s results after the markets close. "Tonight's numbers from Microsoft may be worth watching as again investments in technology can be something of a barometer of economic health," said Matt Buckland, a dealer at CMC Markets. Investors also remained cautious about staking out big positions in the current climate, especially after investment bank Morgan Stanley posted a bigger-than-expected quarterly loss and reduced its dividend Wednesday. Its results interrupted a string of better-than-expected results from banks that suggested some of their problems were easing. News of Morgan Stanley's disappointing quarterly report has rattled many investors already nervous about the U.S. government's upcoming "stress tests" of the banks, the results of which are due in early May. Worries that some of the medium-sized banks will need fresh capital from the government fueled Wednesday's selling pressure on Wall Street, which saw the Dow down by 82 points and the S&P 500 down by 11 points. The markets have traded in a narrower range over the last couple of weeks, often rising modestly one day and falling the next, having recovered strongly from multi-year lows in the previous few weeks amid rising hopes that recovery could emerge this year.
David Jones, chief market strategist at IG Index, thinks the market is awaiting a significant event to signal that either the end of the recession is truly in sight, or that the bottom seen in March was just a temporary stop before the next plunge. "With a couple of weeks till the release of the next set of unemployment numbers out of the U.S., it looks like the jury could still be out for some time yet," he said. Swiss bank Credit Suisse AG ignited some hopes Thursday that the banks can quickly recover after it reported a first-quarter net profit of 2 billion Swiss francs ($1.72 billion), following a turnaround in its investment bank, which had previously been hit hard by the credit crunch. The figure was better than analysts' expectations for a net profit of up to 1 billion francs and compared with a net loss of 2.15 billion francs in the same quarter last year. Earlier, Asia's markets advanced but trade was cautious amid ongoing worries about banks following Morgan Stanley's results. Reports that Nomura Holdings, Japan's leading brokerage, has incurred a record net loss of 700 billion yen ($7 billion) in the last fiscal year did not help change that view.
Japanese shares fell before rebounding to trade higher, with the Nikkei 225 average closing up 119.71 points, or 1.4 percent, to 8,847.01. Hong Kong's Hang Seng was up 2.3 percent at 15,214.46, and South Korea's Kospi added 0.9 percent to 1368.80. Elsewhere, markets in Australia and Singapore pushed higher. India's Sensex added 1.8 percent. Shanghai's main index was little changed with a 0.1 percent gain. Oil prices were little changed, with benchmark crude for June delivery down 7 cents at $48.78 a barrel. The dollar fell to 97.83 yen from 98.03 yen, while the euro rose to $1.3061 from $1.3035. ___ AP Business Writer Jeremiah Marquez in Hong Kong contributed to this report.