Global shares edge down as uncertainty sets in over global economy
By Richard Hubbard
LONDON (Reuters) - A smaller than expected rise in German business sentiment in September and growing uncertainty over the strength of the global economy helped nudge world shares lower on Tuesday, while major currencies were trapped in tight ranges.
Germany's Ifo think tank said that its latest reading on business morale showed that the euro zone's biggest economy was on a sustainable growth path after weak start to the year, but that any recovery was likely to be modest.
"The further rise in German Ifo business sentiment confirms that the economy is recovering, but we continue to expect growth to be reasonably sluggish," said Ben May, a European economist at Capital Economics.
The euro initially slipped when the Ifo fell short of expectations though soon recovered to be little changed against the dollar at $1.35.
European shares turned negative after the report, trading down 0.1 percent on the day, before edging higher again .FTEU3, while German government bond futures hit a session high, up 33 ticks on the day.
The MSCI global index of shares dipped 0.1 percent .MIWD00000PUS after MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS had earlier eased 0.6 percent, taking its cue from a softer Wall Street.
One bright spot was shares in iPhone suppliers, burnished by news that Apple Inc (AAPL.O: Quote) sold 9 million new iPhones during their first three days in stores with U.S. stock futures point to a steady start on Wall Street later in the day.
ECB ADDS TO CAUTION Continued...