LONDON – World stocks turned lower on Friday after official data showed the U.S. economic recovery was not as fast as many had hoped.
The Commerce Department said that the U.S. economy, the world’s largest, grew at a modest 2.8 percent in the final three months of last year. While that is the fastest growth in 2011, economists had expected growth of 3 percent.
A cut in government spending was offset partly by a rise in inventories, which are expected to slow back down in the early months of 2012, hurting growth. After that, “growth will pick up again by late spring,” said Harm Bandholz, chief U.S. economist at UniCredit Bank.
With the data suggesting the U.S. recovery would continue to be a slow process, investors sold off stocks to cash in on gains made so far this month.
Britain’s FTSE 100 was down 1.0 percent to 5,735.64 while Germany’s DAX fell 0.5 percent
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