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Updated Friday, June 3, 2011 10:00 am TWN, AFP

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EU, US stocks slide on rising economic gloom

LONDON -- European equities sank Thursday, after large losses in Asia and overnight on Wall Street, as concerns grew over weak global economic data that has cast a dark cloud over world financial markets.

London's benchmark FTSE 100 index fell 0.71 percent to 5,886.65 points in midday trade, Frankfurt's DAX 30 shed 1.0 percent to 7,145.18 and in Paris the CAC 40 index lost 1.11 percent to 3,920.85.

In foreign exchange deals, the European single currency rose to US$1.4468 from US$1.4331 late in New York on Wednesday.

“Worry is creeping in amongst the ranks of investors as the raft of economic data sets alarms bells over the state of the global economy ringing,” said Capital Spreads analyst Simon Denham.

Traders in the United States went into sell-off mode on Wednesday as they digested miserable data suggesting the world's number one economy is stalling.

Markets were dealt another body blow after Moody's rating agency again downgraded Greek debt and gave it a negative outlook, raising the stakes in rescue negotiations for the troubled eurozone member nation.

“Not only did the realization that the global economy is starting to slow contribute to the sell off, as proved by PMI readings that all came in lower than expected, but a further downgrade to Greece compounded the situation.”

U.S. stocks mostly fell Thursday a day after a sharp rout as investors weighed a weaker-than-expected dip in jobless claims ahead of the keenly awaited May job report.

The Dow Jones Industrial Average shed 42.61 points (0.35 percent) to 12,247.5 in the first 20 minutes of trade.

The broader S&P 500 index fell 3.98 points (0.30 percent) to 1,310.57, while the tech-rich Nasdaq Composite struggled higher, gaining 0.14 point (0.01 percent) at 2,769.33.

Stocks rebounded from Wednesday's steep sell-off that had been driven by grim jobs and manufacturing data revealing deep weaknesses in the U.S. economy.

The Dow dropped 2.22 percent, the S&P 500 fell 2.28 percent and the Nasdaq shed 2.33 percent.

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