Weak data and crisis worries hit shares, euro

European shares and the euro fell on Thursday after weak Chinese and French data underlined worries about global economic growth, and a promise of extra oil from Saudi Arabia also helped to push crude prices to a six-week low.

Global shares have lost momentum this week with investors now taking stock after a nearly 17% rise in the MNSI world index since the start of June.

European equities opened down 0.6%, helping to keep the MSCI world index 0.7% lower. London's FTSE 100, Paris's CAC-40 and Frankfurt's DAX all opened down and futures prices also pointed to a weak Wall Street open as well.

China's flash Purchasing Managers Index ticked up to 47.8 in September from a nine-month low in August of 47.6, but remained below 50 for an 11th month in a row, showing the sector was still contracting.

France added to the gloom with the country's flash PMI falling to a 3-1/2 year low of 44.1 in September, from August's 48.0.

Spain, which has yet to say whether it wants an EU bailout that would allow the European Central Bank to buy its bonds, faces a confidence test later when it auctions 4.5 billion euros of mid and longer term bonds.

German government bonds, favoured by risk adverse investors, were in demand before the sale. Bund futures were up 24 ticks to 139.95, adding to the 150 tick rebound they have seen this week which they started at a 5-1/2 month low.

The euro was also down sharply and hit a one week low of $1.

Brent crude prices moved below $108 a barrel as a promise from Saudi Arabia to boost supply was compounded by China's weak data.

"Saudi Arabia's commitment has been the biggest factor in the decline this week as a lot of money managers are cutting their long positions in oil after the statement," said Ken Hasegawa, a commodity sales manager with Newedge in Tokyo.

"China PMI data was also a big trigger and with the market already in a downtrend, we are seeing more profit-taking."