World markets underwhelmed by EU plan for Greece

(AP) — World stocks dropped Thursday as traders were left uninspired by the lack of detail and concrete measures in European leaders' promises to help debt-ridden Greece and bolster confidence in the eurozone.

The 16 euro nations said they were ready to take "coordinated measures" if necessary to support Greece. However, European Union President Herman Van Rompuy gave no firm offer of financial aid to Greece, and insisted that Greece hadn't asked for any.

Stock indexes fell sharpest in euro member states, with Germany's DAX closing 0.6 percent lower at 5,503.93 and France's CAC-40 shedding 0.5 percent to 3,616.80. Britain, which is not part of the euro, saw its FTSE 100 index actually rise, by 0.5 percent, to 5,161.50.

Greece's main index was flat at the close while the bond spreads — which measure the market's perception of a risk of default — widened to where they were before the announcement, although they remained well below last week's levels.

Wall Street also slipped, while Asian markets had earlier closed higher. The Dow Jones industrial average slipped 0.1 percent to 10,028.41 while the Standard & Poor's 500 fell 0.2 percent to 1,065.63.

The markets had been higher before the announcement, after rallying all week, on expectations that Europe's richest and most stable countries, namely Germany and France, would extend support to Greece.

But the statement by euro nations gave few details on what form that help would take: "Euro area members will take determined and coordinated action if needed to safeguard stability in the euro zone as a whole," Rompuy told reporters, reading from the statement.

That was not enough for investors, who showed their skepticism by dumping stocks and the euro.

"What we did not get was the level of solidarity that we were looking for," said David Buik, analyst at BGC Partners.

"They say there is total solidarity, but there were no clear plans for cutting any public expenditure from any constituent country. These questions were left unanswered," Buik said.

"The EU will need to put more meat on the bone and I suspect there is not enough to go around," he added.

The euro fell to $1.3636 after the announcement, from $1.3800 earlier Thursday, while the dollar edged down to 89.77 yen from 89.91 yen.

Asian markets have this week largely followed the ebb and flow of confidence in the eurozone, but were boosted overnight by upbeat regional economic figures.

New statistics out of Beijing showed a spike in inflation eased in January — consumer prices climbed 1.5 percent over a year earlier, down from December's sharp 1.9 percent rise.

The decline suggests Beijing can put off taking drastic steps, such as a rate hike, that would have global repercussions if it slowed China's recovery and its demand for imported raw materials and consumer goods.

"The inflation data surprised us because it was a lot lower than the market expected," said economist Liu Qiyuan of China Merchant Securities.

The news helped send China's Shanghai index up 0.1 percent to 2,985.50, while Hong Kong's Hang Seng index jumped 1.9 percent to 20,290.69. Japanese financial markets were closed for a national holiday and will reopen Friday.

Analysts, however, warned against reading too much into the day's gains.

Hong Kong markets will be closed Monday and Tuesday, while markets in mainland China will be closed all week.

Strong jobs data drove Australia's benchmark up 0.9 percent to 4,554.3, while markets in Taiwan, Singapore and South Korea also posted gains.

Oil prices fell in European trading, with benchmark crude for March delivery up 4 cents at $74.56 a barrel.

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AP Business Writers Tomoko A. Hosaka in Tokyo and Joe McDonald in Beijing contributed to this report.