BANGKOK - Asian stock markets stalled Thursday, following evidence of an uneven recovery in Europe and lacklustre strength in U.S. consumer spending.
The eurozone economy grew by 0.3 per cent in the April-June period, its first quarter of growth since recession hit the region in late 2011. But analysts attributed much of the rebound to the region's two largest economies, Germany and France. Germany's GDP for the period rose 0.7 per cent, while's France rose an unexpected 0.5 per cent.
Europe's smaller economies remained bogged down in debt and high unemployment, problems that will take years to resolve.
"What the GDP numbers have done is expose the continued fragmentation within a region where the various economies have different competitive advantages," said Michael Hewson, senior market strategist at CMC Markets, in an email commentary.
Japan's Nikkei 225 index tumbled 1.6 per cent to 13,821.10. South Korean markets were closed for a public holiday. Hong Kong's Hang Seng rose 0.4 per cent to 22,630.85. Australia's S&P/ASX 200 was flat at 5,157.80. Benchmark indexes in Singapore, Taiwan, Indonesia and the Philippines fell. Those in mainland China and New Zealand rose.
In the U.S., a poor earnings report from major retailer Macy's cast doubt on the outlook for consumer spending, a vital component of the U.S. economy.
Macy's, which operates its namesake stores and Bloomingdales, reported that its profits fell short of analysts' estimates. Macy's blamed shoppers' reluctance to spend for a slip in sales.
Retail sales are closely watched because consumer spending accounts for 70 per cent of U.S. economic activity.
The figures could have an impact on expectations of when the Fed will start to reduce its monetary stimulus. Most economists think that so-called tapering will start as soon as next month.
The Dow Jones industrial average declined the most in six weeks Wednesday. The Dow fell 113.35 points, or 0.7 per cent, to 15,337.66. The Standard & Poor's 500 index dropped 0.5 per cent to 1,685.39. The Nasdaq composite fell 15.17 points, or 0.4 per cent, to 3,669.27.
Benchmark oil for September delivery rose 26 cents to $107.11 per barrel in electronic trading on the New York Mercantile Exchange. The contract rose 2 cents to close at $106.85 a barrel on the Nymex on Wednesday.
In currencies, the euro rose to $1.3300 from $1.3257 late Wednesday. The dollar fell to 97.82 yen from 97.87 yen.
Follow Pamela Sampson on Twitter at http://twitter.com/pamelasampson
© Copyright 2013