LONDON, May 4 — Global stock markets extended their sell-off today as disappointing US jobs figures added to reignited concerns about weak growth.

After a run of gains for equities, traders have been spooked by a string of disappointing data from China to Europe and the United States that has led them to question whether hopes of a nascent recovery were overdone.

However the dollar has continued to recover from eight-month lows versus the euro on hints that the US Federal Reserve may still hike US interest rates in June, analysts said.

While this makes the US currency a more attractive investment, higher borrowing costs can weigh on economic growth.

The euro hit US$1.1616 yesterday, the highest point since late August but was standing at US$1.1511 in Wednesday deals.

“The US dollar index made a new low for the year yesterday, briefly recovering on the back of comments from the Fed’s Dennis Lockhart that a hike in interest rates at the June... meeting is still on the cards,” said Neil MacKinnon, economist at financial group VTB Capital.

Comments from Federal Reserve officials suggesting the US central bank could hike interest rates as soon as next month also provided support to the greenback against the yen after plummeting over the past month.

Across the Atlantic meanwhile, the European Union yesterday cut its eurozone growth forecasts for this year, warning that global risks including the slowdown in China and the danger of Britain leaving the EU were having a damaging effect.

The news was the latest of a flurry of data highlighting weaknesses in the global economy, including a shrinkage or slowdown of manufacturing activity in China, Britain and the United States.

London’s FTSE led Europe’s main bourses into negative territory today, at just over 1.0 per cent down in mid-afternoon trading, followed by Paris’ CAC and the DAX in Frankfurt.

Wall Street stocks opened lower as disappointing private-sector hiring figures for April added to worries that the US economy is slowing.

Sheraz Mian, of Zacks Investment Research, said the jobs data was “the first weak showing on the labour market front, which, if confirmed by the Friday government jobs report, will represent a notable deterioration in the US economic outlook”.

The mining sector, already under pressure from weak demand growth for metals, took another knock with BHP Billiton’s share price plunging on news that Brazilian prosecutors had slapped it with a US$43-billion (RM169.6-billion) lawsuit over November’s deadly Samarco dam disaster.

BHP stock lost more than 9.0 per cent in Sydney, while its London-listed shares were down just over 4.0 per cent at 839.70 pence on London’s FTSE 100.

Sydney’s equity market meanwhile closed down 1.5 per cent today. Across Asia, Hong Kong lost 0.7 per cent and Seoul shed 0.5 per cent.

Shanghai flitted between gains and losses after Chinese authorities hinted at unveiling measures to support the country’s stock markets. The city’s benchmark index ended 0.1 per cent lower.

Tokyo remained closed for a public holiday.

Key figures around 1340 GMT -

London - FTSE 100: DOWN 1.0 per cent to 6,122.27 points

Frankfurt - DAX 30: DOWN 0.7 per cent at 9,855.10

Paris - CAC 40: DOWN 0.9 per cent at 4,333.37

EURO STOXX 50: DOWN 0.9 per cent at 2,947.85

Hong Kong: DOWN 0.7 per cent at 20,525.83 (close)

Shanghai: DOWN 0.1 per cent at 2,991.27 (close)

Tokyo: Nikkei 225: Closed for public holiday

New York - Dow: Down 0.5 per cent at 17,671.50

Euro/dollar: UP at US$1.1511 from US$1.1507 yesterday

Dollar/yen: UP at 106.67 yen from 106.63 yen — AFP