Business
BANGKOK (AP) — World stocks were dimmed Wednesday by a weaker outlook for global growth. Markets also braced for the release of Fed minutes that could spark a new wave of speculation about when the central bank will reduce its monetary stimulus.
In a half-yearly report, the Organization for Economic Cooperation and Development cut its forecast for world growth this year to 2.7 percent and 3.6 percent for next. In May, it had predicted 3.1 percent and 4 percent growth, respectively. There were particularly sharp downgrades for Brazil and India though China's forecast was raised.
The more pessimistic forecasts reinforced current thinking that gains in stock markets, fueled by easy monetary policy, are out of step with the reality of lackluster economic growth in rich developed nations and fading momentum in many developing economies.
Major stock benchmarks in Britain, France and Germany were lower, but by less than 0.1 percent. Futures indicated modest gains on Wall Street, with S&P 500 and Dow futures both up 0.1 percent.
Later Wednesday, the Federal Reserve releases minutes of its Oct. 29-30 policy meeting that will be parsed for new insights into the central bank's thinking on the economy and the longevity of its low interest rate policies.
Near-zero rates on fixed-income investments have pushed investors into riskier but potentially higher yielding assets such as stocks. That has fed gains in stocks but left investors on edge for signs the central bank will start reducing its purchases of government bonds and mortgage securities totaling $85 billion a month.
Janet Yellen, who is slated to become the next Fed chairman, has already expressed strong support for low interest-rate and bond buying policies aimed at stimulating U.S. growth.
In Asia, Japan's Nikkei 225 stock average shed 0.3 percent to 15,076.08 and Seoul's Kospi dropped 0.7 percent to 2,017.24. Australia's S&P/ASX 200 ceded 0.8 percent to 5,307.70. Most Southeast Asian markets also fell.
Hong Kong's Hang Seng added 0.2 percent to 23,700.86 and China's Shanghai Composite reversed losses to gain 0.6 percent to 2,206.61.
In energy trading, benchmark U.S. crude was up 21 cents at $93.55 a barrel in electronic trading on the New York Mercantile Exchange. The contract gained 31 cents to $93.34 on Tuesday.
The euro fell to $1.3532 from $1.3353 late Tuesday. The dollar fell to 100.01 yen from 100.11 yen.
Copyright 2013 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.
