China Drops, Other Markets Up

China Drops, Other Markets Up

SEOUL, South Korea (AP) -- China's stock market extended loss while other global stocks mostly gained Friday after data showed the U.S. economy posted solid growth during the second quarter.

KEEPING SCORE: Europe opened moderately higher with Britain's FTSE 100 up 0.1 percent to 6,673.08 and Germany's DAX gaining 0.2 percent to 11,277.44. France's CAC 40 rose 0.5 percent to 5,072.11. Futures augured a tepid start for Wall Street. Dow futures remained flat while S&P futures rose less than 0.1 percent.

ASIA'S DAY: The Shanghai Composite Index finished 1.1 percent lower at 3,663.73, extending its loss to a second day. South Korea's Kospi finished up 0.6 percent at 2,030.16. Japan's Nikkei 225 added 0.3 percent to 20,585.24 while Hong Kong's Hang Seng index rose 0.6 percent to 24,636.28. Stocks in Australia and New Zealand were higher as well as most stocks in Southeast Asia.

CHINA'S SWING: The Shanghai benchmark finished this month with the worst monthly loss since August 2008, losing 14.3 percent in July. The index suffered its biggest one-day drop in eight years on Monday when it plunged 8.5 percent despite government intervention. Stocks recovered moderately on Wednesday before falling again on Thursday. Analysts say the volatility is a sign that economic fundamentals cannot supportstock prices at their current levels and that the government's support measures may have been less effective than what Beijing expected.

ANALYST'S TAKE: "Chinese markets should continue to grind sideways in the coming sessions, as some calm returned to the market," said Bernard Aw, a market strategist at IG. "(Thursday's) decline is expected to be tolerated by the authorities, but we could still see state fund bids cushioning the downside."

US ECONOMY: Driven by strong consumer spending, the U.S. economy expanded 2.3 percent in the April-June quarter, the best showing since last summer. First-quarter growth was revised to 0.6 percent growth from an earlier government estimate of a contraction. The data underscored the steady growth that is likely to bolster the Federal Reserve's case that it will soon be time to raise rates from a record low. Fed policymakers voted Wednesday to leave interest rates unchanged. Many investors expect the Fed will lift rates in September or December.

OIL: Benchmark U.S. crude lost 98 cents to $47.54 per barrel in electronic trading on the New York Mercantile Exchange. The contract fell 27 cents to close at $48.52 a barrel on Thursday. Brent crude, a benchmark for international oils used by many U.S. refineries, fell 63 cents at $52.68 a barrel in London.

CURRENCIES: The dollar rose 0.1 percent to 124.27 yen and the euro edged up 0.2 percent to $1.0955.

(KA)