World stocks slip on China growth worries

World stock markets sank on Tuesday over worries about slower economic growth in China and a possible snag in the deal for Greece to get its bailout money.

In early European trading, Germany's DAX was down 0.4 per cent at 6,835 and the CAC-40 in France fell 0.4 per cent to 3,473.81. The FTSE 100 index of leading British shares lost 0.3 per cent to 5,857.35.

US stocks were poised to fall. Dow futures were down 0.3 per cent at 12,915. Broader S&P 500 futures were down 0.4 per cent at 1,358.70.

Asian stock markets slid. Mainland Chinese shares saw their biggest loss in almost a month a day after Premier Wen Jiabao lowered the country's economic growth target to 7.5 per cent from the 8 per cent level it has stood at for years. The new target underlines China's emphasis on better, not faster, growth.

The benchmark Shanghai Composite Index lost 1.4 per cent to 2,410.45. The Shenzhen Composite Index for China's second smaller stock market lost 1 per cent to 971.8.

Wen's announcement is cause "for some concern that China might not roll out so many pro-growth policies in the near future," said Jackson Wong, a vice president at Tanrich Securities.

Elsewhere in Asia, Japan's Nikkei 225 index dropped 0.6 per cent to 9,637.63 and South Korea's Kospi shed 0.8 per cent to 2,000.36.

Hong Kong's Hang Seng lost 2.2 per cent to 20,806.25 and Australia's S&P/ASX 200 retreated 1.4 per cent to 4,204.70. Benchmarks in Taiwan, Singapore and India also fell.

Greece's long-running debt crisis also weighed on the markets because of worries not enough investors will swap their Greek government bonds for new ones that are worth less and pay lower interest.

Greece will learn by Thursday night what per centage of private creditors will participate in the bond swap. Without the debt relief, Greece won't get a second, euro 130 billion ($172 billion) international bailout and would face a default on its debts.

"Before the close of business on Thursday, we really don't know whether it's going to be a go," said Wong. "So it just seems not to be very wise to get into market at this point."

Investors may also be hanging back because they're waiting for the release of some key economic data over the next few days, Wong said. Those include a private report on US payrolls on Wednesday, Chinese inflation on Thursday and US jobless data on Friday.

In Hong Kong, AIA Group Ltd. tumbled 8.4 per cent after New York-based insurer American International Group said it was selling off a substantial stake in the company to help repay the US government for its financial crisis bailout.

Shares of companies tied to China's housing sector, such as cement companies led declines in mainland markets. So did nonferrous metal companies and coal miners.

Shares of Industrial & Commercial Bank of China Ltd. fell 3.8 per cent after the South China Morning Post newspaper, citing unnamed sources, reported that Goldman Sachs was planning to sell of a big chunk of the shares it owns in China's biggest state-owned commercial lender.

In currencies, the euro fell to $1.3182 from 1.3224 in late trading Monday. The dollar fell to 81.27 yen from 81.46 yen.

Benchmark crude for April delivery dipped 4 cents to $106.68 a barrel in electronic trading on the New York Mercantile Exchange. The contract rose 2 cents to settle at $106.72 per barrel on Monday.