* MSCI world equity index down 0.52 pct post-U.S. data, G20
* European stocks down, German election boosts utilities
* Yen hits 8-mth high vs dollar, U.S. stock futures edge up
By Carolyn Cohn
LONDON, Sept 28 (Reuters) - World stocks hit a 12-day low on
Monday, depressed by recent weak U.S. economic data and failing
to find support from the G20 summit, while the yen attracted
fresh flows to hit an eight-month high against the dollar.
Weaker-than-expected U.S. housing sales and durable goods
orders on Friday drove U.S. stocks lower, and world and European
stocks followed that trend on Monday.
Leaders of the Group of 20 rich and developing nations
pledged on Friday to bring the global economy back into balance
but their statement contained few surprises and investors are
already looking ahead to U.S. employment data at the end of this
week.
Global equities and other higher risk assets have risen
sharply in the last six months on growing optimism about the
economic outlook, but markets are starting to run out of
impetus, analysts say.
"Investors are a little bit reluctant to add to their risk
positions," said Koen De Leus, economist at KBC Securities.
"The market is going to have a very good look at
macroeconomic numbers this week. If some of these figures
disappoint, then the market is going to go down further."
Analysts are starting to question whether the global
recovery is V-shaped, or if it could be W-shaped, with a second
dip to come.
The MSCI world equity index <.MIWD00000PUS> was down 0.52
percent at 282.94, bringing losses since Sept 22 to 3 percent.
U.S. stock index futures <DJc1><SPc1><NDc1>, however, were
indicating a slightly stronger open on Wall Street after the
market scored a third consecutive day of losses on Friday.
The FTSEurofirst 300 index <> hit its lowest in nearly
three weeks before trimming losses to 982.53, down 0.14 percent
from the U.S. close.
GERMAN STOCKS UP
German stocks <>, however, rose 1.3 percent with
particularly strong gains in utilities E.ON <EONGn.DE> and RWE
<RWEG.DE>, on expectations of longer lifetimes for German
nuclear power plants as a result of the German election.
German Chancellor Angela Merkel's conservatives won a
weekend parliamentary election with the pro-business Free
Democrats (FDPP), enabling her to end her awkward four-year-old
partnership with the Social Democrats (SPD).
"(This) government provides the greatest opportunities for
equity market-friendly reforms compared to other party
combinations," said Tammo Greetfeld, equity strategist at
Unicredit, in a client note.
The yen, typically regarded as a safe-haven currency, surged
to an eight-month high against the dollar as Japanese officials
waved off any plans to stem the currency's rise.
The yen later gave up some gains as Finance Minister
Hirohisa Fujii changed gear on his comments during the course of
the day, saying yen gains were becoming one-sided just hours
after saying the rise was "not abnormal". []
The dollar fell as far as 88.26 yen <JPY=> before trimming
losses to 89.35, down 0.31 percent.
However, the dollar hit a 2-1/2 week high against an index
of currencies <.DXY> and a 13-day high against the euro <EUR=>
as the U.S. currency also attracted safe-haven flows.
Funds are starting to shift money home ahead of the
quarter-end later this week, analysts say.
Crude oil dipped 20 cents to $65.82 a barrel <CLc1>.
Euro zone government bonds also benefited from safety
trades, with 10-year yields briefly hitting a one-month low.
December Bund futures <FGBLZ9> were up 5 ticks, trimming
earlier gains.
(Additional reporting by Brian Gorman and Atul Prakash, editing
by Mike Peacock)
