LONDON (AP) – World markets fell Friday as investors were disheartened by weak corporate and economic figures and confirmation that Britain plunged into recession at the end of last year.

The news that Samsung saw its first-ever quarterly loss came on the heels of Thursday’s bleak U.S. unemployment and housing figures and Microsoft’s announcement of its first mass layoffs in its 34-year history. And as investors came to their desks Friday morning, official data showed Britain’s economy shrank 1.5 percent in the fourth quarter – the sharpest quarterly downturn since the early days of Margaret Thatcher’s government almost 30 years ago.

European markets mostly recouped their earlier losses after the Dow – which fell 210 to 7,912 in the opening minutes of trading – recovered to 8,042, or 80 points down, in morning trade in New York. The Standard & Poor’s 500 index was down 0.19 percent and the Nasdaq composite index rose 0.53 percent.

Dow component General Electric Co. reported fourth-quarter profits Friday morning that were in line with analysts’ expectations but at the bottom end of the company’s guidance. Its shares fell 6.01 percent, further weighing on sentiment.

Copier and printer maker Xerox Corp. said profits fell to $1 million for the three months ended Dec. 31, from year-ago profit of $382 million. Its stock was down 9.5 percent, after slumping at one point by 20 percent.

European markets were spooked by news the British economy had officially slid into recession.

Britain’s benchmark FTSE 100 index closed up a slight 0.01 percent to 4052.47. Germany’s DAX closed down 0.96 percent at 4,178.94, and France’s CAC 40 shed 0.71 percent to 2,849.14.

Analysts said the general sharp deterioration in stock markets reveals an increasingly pessimistic outlook for the year ahead, with bad economic news coming thick and fast from all corners of the globe. That is pushing investors to drop riskier equities in favor of lower risk government bonds, or gold.

“The race to the bottom amid G-7 economies speeds up the risk-reduction trades as macroeconomic data pushes superlatives to higher levels,” said Ashraf Laidi, chief market strategist at CMC Markets.

The fall in British economic output, for example, was worse than the market expected and surprised with sharp drops in industrial production and services.

“Clearly this sets a very weak platform for GDP growth this year and suggests that our forecast for a 2.5 percent drop could be too optimistic,” said Vicky Redwood, analyst at Capital Economics in London.

Europe’s losses followed even sharper drops in Asia, where Japan’s Nikkei 225 dropped 3.8 percent to 7,745.25, while Hong Kong’s Hang Seng Index eased 0.6 percent to 12,578.60 and South Korea’s Kospi sank 2.1 percent to 1,093.40.

Both financial and technology stocks were under pressure on fears a deeper global downturn would continue to weigh on corporate earnings.

Barclays stock was down 13.5 percent in London on worries it may require a bailout from the British government in a plan which may mean part-nationalization. Auto companies also saw steep falls, with BMW down 3.8 percent in Frankfurt, while chip maker Infineon AG fell 4.9 percent after its unit Qimonda declared bankruptcy.

“Profit concerns continue to intensify, with consensus estimates now looking for an overall fall of around 28 percent in Q4 earnings in the S&P 500,” said Mitul Kotecha at Calyon in London.

Investors were stunned overnight by news software giant Microsoft Corp. was slashing 5,000 jobs and had suffered an 11 percent drop in profit last quarter. Upbeat earnings by Google Inc. did little to alleviate investors’ sour mood.

The gloom was echoed in Thursday’s U.S. economic data, which showed construction of new homes and apartments slid 15.5 percent in December, closing out the worst year for builders since at least 1959. Meanwhile, first-time applications for unemployment benefits jumped last week to 589,000, the most since 1982.

Things were similarly bleak across Asia, where Japan’s Sony Corp. projected its first annual net loss in 14 years and announced job cuts. In South Korea, Samsung Electronics, the world’s largest manufacturer of flat-screen televisions and memory chips, posted its first ever quarterly loss Friday as the slowdown hit prices.

Shares of Sony tumbled 7 percent to their lowest level in a month. Nippon Steel Corp., Japan’s biggest steelmaker, lost 5 percent after saying it would cut production by the largest amount in its four-decade history as auto demand gets squelched by the global slowdown.

“I don’t see any signs of revival in the economy this year, definitely not,” said Peter Lai, investment manager at DBS Vickers in Hong Kong. “There are too many uncertainties, too much negative news. I don’t think the worst is over.”

Oil prices were lower, with light, sweet crude for March delivery falling $1.26 to $42.41 a barrel. The contract rose overnight 12 cents settle at $43.67.


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