Shares pressured by Europe, Korea worries

BEIJING (AP) - Global stock markets mostly gained Wednesday despite jitters about Europe's debt problems, Korean tensions and disappointing growth in Australia.

Oil prices rose to close to $85 a barrel amid the release of surveys showing China's manufacturing accelerated in November. The dollar was down against the yen and the euro.

In Europe, London's FTSE-100 index rose 0.8 percent to 5,570.76 while the CAC-40 in Paris added 0.7 percent to 3,635.18 and Germany's DAX gained 0.8 percent to 6,769.56. Wall Street was also set to open higher, with Dow futures up 0.5 percent to 11,055.

Japan's Nikkei 225 rose 0.5 percent at 9,988.05, Hong Kong's Hang Seng gained 1 percent to 23,249.80 China's Shanghai Composite Index was up 0.1 percent at 2,823.44.

Australia's S&P/ASX 200 closed flat at 4,586.6 after the country's gross domestic product grew just 0.2 percent in the third quarter from the previous three months.

"Trading is sluggish today. Investors are on the sidelines waiting to see what happens in Korea and the European debt situation," said Linus Yip, a strategist in Hong Kong for First Shanghai Securities.

Chinese shares were mixed amid worries over a possible rate hike to cool inflation and surveys showing stronger November manufacturing. A rate hike might slow rapid growth and rein in liquidity that is helping to support share prices.

"At this point, it's a psychological effect on the market," though a rate hike would be "not so damaging," Yip said. "Overall, for mainland China and the Hong Kong market, the outlook is still positive."

Shanghai market heavyweight PetroChina Ltd., Asia's biggest oil producer, slipped 0.9 percent to 10.97 yuan, weighing down broad gains in financials and property shares.

South Korea's Kospi rose 1.3 percent to 1,929.32 as jitters over sporadic skirmishes between the two Koreas eased. Market benchmarks in Taiwan and Bombay also were up.

Meanwhile, surveys released Wednesday showed China's manufacturing recovery accelerated in November. China is a major importer of oil and other raw materials, and stronger manufacturing could help to boost global demand.

The state-affiliated China Federation of Logistics and Purchasing said its purchasing managers index, or PMI, rose to 55.2 last month from 54.7 in October and 53.8 in September on a 100-point scale where numbers above 50 indicate rising activity.

A competing index, the HSBC China Manufacturing PMI rose to an eight-month high of 55.3 percent in November, up from 54.8 percent in October.

In New York on Tuesday, the Dow Jones industrial average fell 46.47, or 0.4 percent, to close at 11,006.02.

The Dow recovered some early losses after President Barack Obama and Republican lawmakers promised to seek a compromise before the end of the year on extending tax cuts adopted during the presidency of George W. Bush.

The Conference Board reported its main U.S. consumer confidence index rose to a five-month high in November ahead of the Christmas buying season, a sign the recovery in the world's largest economy is picking up pace.

Sentiment dragged as investors sold off government bonds from Spain, Portugal and Italy. The bailout of Ireland's banks has failed to assuage worries that other weak European economies will also need to be rescued.

Benchmark oil for January delivery rose 85 cents to $84.96 a barrel in electronic trading on the New York Mercantile Exchange at mid-afternoon Kuala Lumpur time. The contract fell $1.62 to settle at $84.11 on Tuesday.

In currencies, the dollar fell to 83.78 yen from 83.92 late Monday. The euro rose to $1.3064 from $1.3039.

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