World Markets Mostly Down Ahead of U.S. Jobs Report

SHANGHAI, China – World markets were mostly lower Friday as caution ahead of a key reading on the U.S. jobs market overshadowed big rate cuts by central banks in Europe. Oil traded near four-year lows.

Japan's Nikkei 225 average ended the week with a whimper, closing down 6.73 points, or 0.1 percent, at 7,917.51 as investors wavered between hunting for bargains and staying cautious ahead of the U.S. employment report later Friday.

Major European bourses opened lower with Britain's FTSE-100 down 1.5 percent at 4,103.15, Germany's DAX off 2.6 percent at 4,445.32 and France's CAC-40 down 2.7 percent at 3,078.74.

Elsewhere in Asia, Hong Kong's Hang Seng index advanced 2.5 percent to 13,846.09 and South Korea's Kospi climbed 2.1 percent to 1,028.13 but markets in Australia, Taiwan, Indonesia, New Zealand, the Philippines and Malaysia retreated.

Big interest-rate cuts by the European Central Bank and Bank of England failed to give much of a lift to sentiment and investors also contended with a raft of weak data on the world's largest economy.

"There is no major funding going into the market, so it is losing momentum," said Linus Yip, a strategist at First Shanghai Securities in Hong Kong, where turnover was light. "Major investors are still staying on the sidelines," he said.

On Wall Street Thursday, the Dow Jones industrial average slid 215.45 points, or 2.5 percent, to 8,376.24.

The number of Americans claiming unemployment benefits last week reached its highest level in 26 years, while factory orders plunged a bigger-than-expected 5.1 percent in October. The U.S. Labor Department unemployment report due Friday was expected to show the jobless rate rose to 6.8 percent in November as companies slashed 320,000 jobs.

Wall Street futures pointed to falls in the U.S. on Friday with Dow futures down 10 points, or 0.1 percent, at 8391 and S&P500 futures down 2.5 points, or 0.3 percent, at 845.

Japan's benchmark index ended down 7 percent for the week, dogged by uncertainty over prospects for U.S. automakers to win an expanded $34 billion rescue package, analysts said.

Toyota Motor Corp. lost 1.9 percent and Honda Motor Corp. shed 1.9 percent following news it was pulling out of Formula One to save costs.

"Investors will be keeping a particularly close eye on what happens in the U.S. housing and auto sectors," said Tsuyoshi Segawa, a strategist at Shinko Securities in Tokyo.

Chinese shares rebounded from early weakness, with the benchmark Shanghai Composite Index rising 0.9 percent to to 2,018.66. The Shenzhen Composite Index rose 2.3 percent.

Property developers were among the biggest gainers, as China Vanke jumped 5.5 percent and Poly Real Estate climbed 4.9 percent.

Investors are looking to a top-level planning meeting next week for fresh policies to help boost China's economy, analysts said. Although the Shanghai benchmark is up 6.7 percent for the week, it is still 60 percent below the peak it hit in October 2007.

"Buying sentiment is gradually recovering, because we know some funds and insitutional investors are taking an active part in trading," said Zhang Xiuqi, an analyst for Guotai Junan Securities, in Shanghai.

"It's a good sign. As you know, the new year is on its way," Zhang said.

Australia's All Ordinaries index slipped 1.2 percent as resource shares fell on expectations of falling demand. Mining giant BHP Biliton tumbled 4.9 percent and Woodside Petroleum was down 2.1 percent.

Light, sweet crude for January delivery was up 27 cents at $43.94 a barrel in electronic trading on the New York Mercantile Exchange by midafternoon in Singapore. The contract fell overnight $3.12 to settle at $43.67, the lowest since January 2005.

Associated Press business writer Tomoko Hosaka in Tokyo contributed to this report.