BEIJING— Global stocks mostly fell on Tuesday as Greece’s spiraling crisis kept investors on edge and as Chinese markets dropped despite government intervention.
KEEPING SCORE: Germany’s DAX was down 0.9 percent to 10,791.62 and France’s CAC-40 shed 1.1 percent to 4,661.36. Britain’s FTSE 100 dropped 0.3 percent to 6.514.61. Wall Street looked set for small gains. Futures for the Dow Jones industrial average and the Standard & Poor’s 500 were up 0.1 percent and 0.2 percent, respectively.
GREECE: Greece and its creditors will hold talks on Tuesday to try to reach a deal — or at least make progress toward one — to keep the country from falling out of the euro. Analysts say Greece has only a matter of days left before its banks collapse. The European Central Bank Many has refused to increase the emergency credit the banks need to cope with deposit withdrawals. Greece is expected to present new proposals to creditors Tuesday to get negotiations going again.
ASIA’S DAY: Earlier, the Shanghai Composite Index fell 1.3 percent to 3,727.12 and Hong Kong’s Hang Seng declined 1 percent to 24,975.31. Tokyo’s Nikkei 225 advanced 1.3 percent to 20,376.59 and Sydney’s S&P/ASX 200 added 1.9 percent to 5,581.40. Seoul’s Kospi lost 0.7 percent to 2,040.29 and Taipei, Manila and Jakarta also declined. India’s Sensex advanced 0.2 percent to 28,277.91.
CHINA’S DECLINE: Chinese shares have fallen nearly 30 percent after hitting a peak June 2. Most Chinese indices still are up about 80 percent after starting an explosive rise late last year. New emergency measures announced last weekend included buying by brokerages and more credit from the central bank to finance trading. That helped to push up shares in big state companies such as banks and oil producers by up to 10 percent on Tuesday but smaller companies declined. The Shenzhen Composite Index for China’s second exchange, which has a bigger proportion of small companies than Shanghai, fell 5.8 percent. Analysts say artificial measures cannot keep prices up without improved fundamentals at a time when economic growth is near a two-decade low.
ANALYST’S TAKE: “China’s leadership has doubled down on its efforts to prop up equity prices because it believes that its own credibility is now coupled to continued gains on the markets,” said Mark Williams of Capital Economics in a report. “It is following a risky path. Our view remains that a market rally cannot run ahead of economic fundamentals indefinitely,” he said. “There is a good chance that the market rescue efforts are seen to be a failure in a few months’ time.”
ENERGY: Benchmark U.S. crude fell 19 cents to $52.34 per barrel in electronic trading on the New York Mercantile Exchange. On Monday, the contract plummeted $4.40 to $52.53 on concern about a possible European slowdown triggered by the Greek crisis.
CURRENCIES: The dollar fell to 122.49 yen from 122.64 yen in the previous trading session. The euro declined to $1.0936 from $1.1056.