BANGKOK – World stocks were mixed Monday after a ratings downgrade rattled Europe and crucial talks aimed at nudging Greece toward solvency were mired in disagreement.

Benchmark oil prices rose above $99 per barrel and the dollar gained against the euro but fell against the yen.

Early trading in Europe was skittish. Britain’s FTSE 100 was up 0.2 percent at 5,649.93 and Germany’s DAX added 0.5 percent to 6,173.91. The CAC-40 in Paris rose just 0.1 percent to 3,199.57 on the first trading day after a downgrade of France’s long-term credit rating by Standard and Poor’s. Markets in the U.S. are closed for a public holiday Monday.

The day opened with losses throughout Asia. Japan’s Nikkei 225 index slid 1.4 percent to close at 8,378.36. Hong Kong’s Hang Seng lost 1 percent at 19,021.20. South Korea’s Kospi dropped 0.9 percent to 1,859.25. Benchmarks in Singapore, Taiwan, India and Indonesia fell.

In mainland China, the Shanghai Composite Index lost 1.7 percent to 2,206.19, while the smaller Shenzhen Composite Index dropped 3.3 percent to 818.17. Almost 70 companies plunged the daily limit of 10 percent.

Standard & Poor’s decision Friday to strip France of its top-notch credit rating and to downgrade eight other nations that use the euro battered investment sentiment, raising fears that a solution to the continent’s sovereign debt crisis may be far off.

Negotiations between the Greek government and its private creditors on a bond swap nearly collapsed Friday. The deal would reduce Greece’s debt by euro100 billion ($127.8 billion) by swapping private creditors’ bonds with new ones of a lower value.

Without the swap, debt-crippled Greece is unlikely to secure a second financial bailout — which could hurtle the country into bankruptcy and send economic shock waves around the world. Greece’s first bailout came in 2010.

“There is growing risk of a disorderly default by Greece, with talks reportedly breaking down after private sector creditors could not agree on the coupon level of fresh bonds,” said Stan Shamu of IG Markets in Melbourne, Australia.

“With a euro14.4 billion bond repayment due in March, and without restructuring in place, the entire sum would fall, making it increasingly likely that Greece will default,” Shamu wrote in a email.

Improving monthly machine orders in Japan did little to stem worries. Core private sector machinery orders, excluding shipbuilding and electricity, rose 14.8 percent in November. That was the fastest growth since January 2008, the government said.

Some analysts said they believed that dealers had largely factored in the risk of a Greek default in their trades and were more concerned about what simmering tensions in the Middle East and Nigeria might do to oil prices.

The U.S. is trying to rally global support for sanctions against Iran for its alleged efforts to develop nuclear weapons. Iran, the world’s fourth-largest oil exporter, has vowed to retaliate by shutting down the Strait of Hormuz, the passage for one-sixth of the world’s oil.

That could send prices skyrocketing and feed inflation in the U.S. and potentially hinder its fragile recovery from the Great Recession.

Meanwhile, a threatened strike by oil workers in Nigeria, a top oil supplier to the U.S., has further complicated the picture. The threat is in response to the government’s decision to end fuel subsidies, which more than doubled the price of gasoline in a country where most people live on less than $2 a day.

“Inflation is just around the corner,” said Tom Kaan of Louis Capital Markets in Hong Kong. “That to me is a bigger concern than Europe. Europe isn’t going to be resolved in a year’s time or three year’s time. I think Greece will go into default and then you will have a two-tiered Europe.”

Financial-related shares headed lower amid worries that the eurozone debt crisis could put pressure on bank lending. Japan’s Mitsubishi UFJ Financial Group Inc. fell 2.7 percent and Mizuho Financial Group Inc. shed 1.8 percent.

In Australia, Platinum Asset Management fell 2.6 percent after the fund last week forecast a drop in profit. But Leighton Holdings jumped 4.4 percent after the construction giant upgraded its underlying profit forecast.

Japanese exporters continued to suffer on the back of a strong yen, which reduces the value of profits earned overseas. Sharp Corp. dropped 3.2 percent, and Sony Corp. fell 2.3 percent. Mazda Motors Corp. was down 3.1 percent.

In energy trading, benchmark oil rose 64 cents to $99.34 per barrel in electronic trading on the New York Mercantile Exchange. The contract fell 40 cents to close at $98.70 per barrel in New York on Friday.

The euro fell to $1.2660 from $1.2670 late Friday in New York. The dollar fell to 76.85 yen from 76.96 yen.

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AP researcher Fu Ting contributed from Shanghai.

BANGKOK – Asian stocks sank Monday after a ratings downgrade rattled Europe and crucial talks aimed at nudging Greece toward solvency were mired in disagreement.

Benchmark oil prices were slightly higher near $99 per barrel and the dollar rose against the euro but fell against the yen.

Japan’s Nikkei 225 index slid 1.5 percent to 8,372.67 and Hong Kong’s Hang Seng lost 1 percent at 19,021.85. South Korea’s Kospi index dropped 1.1 percent to 1,855.95.

Benchmarks in Singapore, Taiwan, India, Indonesia and mainland China also fell.

Standard & Poor’s decision Friday to strip France of its top-notch credit rating and to downgrade eight other nations that use the euro battered investment sentiment, raising fears that a solution to the continent’s sovereign debt crisis may be far off.

Negotiations between the Greek government and its private creditors on a bond swap nearly collapsed Friday. The deal would reduce Greece’s debt by euro100 billion ($127.8 billion) by swapping private creditors’ bonds with new ones of a lower value.

Without the swap, debt-crippled Greece is unlikely to secure a second financial bailout — which could hurtle the country into bankruptcy and send economic shock waves around the world. Greece’s first bailout came in 2010.

“There is growing risk of a disorderly default by Greece, with talks reportedly breaking down after private sector creditors could not agree on the coupon level of fresh bonds,” said Stan Shamu of IG Markets in Melbourne, Australia.

“With a euro14.4 billion bond repayment due in March, and without restructuring in place, the entire sum would fall, making it increasingly likely that Greece will default,” Shamu wrote in a email.

Improving monthly machine orders in Japan did little to stem worries. Core private sector machinery orders, excluding shipbuilding and electricity, rose 14.8 percent in November. That was the fastest growth since January 2008, the government said.

Some analysts said they believed that dealers had largely factored in the risk of a Greek default in their trades and were more concerned about what simmering tensions in the Middle East and Nigeria might do to oil prices.

The U.S. is trying to rally global support for sanctions against Iran for its alleged efforts to develop nuclear weapons. Iran, the world’s fourth-largest oil exporter, has vowed to retaliate by shutting down the Strait of Hormuz, the passage for one-sixth of the world’s oil.

That could send prices skyrocketing and feed inflation in the U.S. and potentially hinder its fragile recovery from the Great Recession.

Meanwhile, a threatened strike by oil workers in Nigeria, a top oil supplier to the U.S., has further complicated the picture. The threat is in response to the government’s decision to end fuel subsidies, which more than doubled the price of gasoline in a country where most people live on less than $2 a day.

“Inflation is just around the corner,” said Tom Kaan of Louis Capital Markets in Hong Kong. “That to me is a bigger concern than Europe. Europe isn’t going to be resolved in a year’s time or three year’s time. I think Greece will go into default and then you will have a two-tiered Europe.”

Financial-related shares headed lower amid worries that the eurozone debt crisis could put pressure on bank lending. Mitsubishi UFJ Financial Group Inc. fell 2.4 percent and Hong Kong-listed Agricultural Bank of China lost 1.4 percent.

In Australia, Platinum Asset Management fell 2.6 percent after the fund last week forecast a drop in profit. But Leighton Holdings jumped 4.4 percent after the construction giant upgraded its underlying profit forecast.

Japanese exporters continued to suffer on the back of a strong yen, which reduces the value of profits earned overseas. Sharp Corp. dropped 3.2 percent, and Sony Corp. fell 2.3 percent. Mazda Motors Corp. was down 3.1 percent.

In energy trading, benchmark oil rose 17 cents to $98.87 per barrel in electronic trading on the New York Mercantile Exchange. The contract fell 40 cents to close at $98.70 per barrel in New York on Friday.

The euro fell to $1.2643 from $1.2670 late Friday in New York. The dollar fell to 76.83 yen from 76.96 yen.

WASHINGTON (Reuters) – Securities and Exchange Commission staff found "apparent failures" at each of the 10 credit rating agencies they examined, including Standard & Poor's, Moody's, and Fitch, the agency said on Friday in its first annual report on credit raters.

The SEC sent letters outlining the staff's concerns to each of the ratings firms and demanded a remediation plan with 30 days, an agency official said in a conference call with reporters.

The SEC staff said concerns include failures to follow ratings methodologies, failures in making timely and accurate disclosures and failures to manage conflicts of interest.

The SEC's report was required by last year's Dodd-Frank financial oversight law.

The staff report did not single out by name any credit-rating agency for questionable actions, but it did describe specific problems it found.

Two of the three largest firms, for example, did not have specific policies in place to manage conflicts of interest when rating an offering from an issuer who is also a large shareholder of the firm.

The industry is dominated by Moody's Corp, McGraw-Hill Cos Inc's Standard & Poor's and Fimalac SA's Fitch Ratings.

One of the large firms, the report said, did not have effective procedures in place to prevent leaks of ratings before they are published, the report said.

One of the three firms also failed to follow its methodology in rating certain asset-backed securities, was slow to discover, disclose and fix the errors, and may have let business interests influence its mistakes, the report said.

The report said the SEC has not determined that any of the findings constituted a "material regulatory deficiency" but said it might do so in the future.

"We expect the credit rating agencies to address the concerns we have raised in a timely and effective way, and we will be monitoring their progress as part of our ongoing annual examinations," said Norm Champ, deputy director of the SEC's Office of Compliance Inspections and Examinations.

Congress first empowered the SEC to closely regulate ratings firms in 2006, and the Dodd-Frank law gave the agency even greater powers over the industry.

Credit raters have been widely criticized for fueling the financial crisis by giving top ratings to subprime mortgage securities that collapsed in value as the housing market cooled.

On Monday, McGraw-Hill disclosed that the SEC might charge its S&P unit with breaking securities laws over ratings it gave a package of securitized mortgages in 2007.

SEC Enforcement Director Robert Khuzami told Reuters this week that the agency faces hurdles proving wrongdoing at credit-rating agencies, pointing to the complexity of the cases and the industry's strong legal defenses. But he added that it would not stop the agency from probing possible misconduct.

(Reporting by Andrea Shalal-Esa, Aruna Viswanatha, Karey Wutkowski; Editing by Gerald E. McCormick and Tim Dobbyn)

WASHINGTON – U.S. securities regulators say their first annual review of the nation’s credit rating agencies finds the rating companies aren’t doing enough to protect their own financial integrity.

The Securities and Exchange Commission report released Friday was mandated by the sweeping financial industry reforms passed last year.

Regulators examined 10 credit rating agencies, including the three largest: Standard & Poor’s, Moody’s and Fitch.

The SEC chastised them for a series of problems including inadequate controls over employee conflicts of interest. Regulators also found the companies sometimes didn’t even follow their own procedures.

The report didn’t specifically identify which of the credit rating agencies suffered the most troubling weaknesses.

BANGKOK – Asian stock markets retreated Wednesday after Moody’s downgrade of Japan’s credit rating offset positive sentiment from a day of big gains on Wall Street.

Japan’s Nikkei 225 index fell 0.2 percent to 8,716.76 after opening higher. South Korea’s Kospi dropped 1.6 percent to 1,749.27 and Hong Kong’s Hang Seng lost 1.1 percent to 19,656.19.

Australia’s S&P/ASX 200 was little changed at 4,173.70. Markets in Singapore, Indonesia and Taiwan fell.

The downdraft in Asia came despite a strong day on Wall Street. Sentiment was dented after Moody’s Investors Service downgraded Japan’s credit rating to Aa3 from Aa2, citing weak growth prospects for the world’s No. 3 economy, massive government debt and constant political uncertainty. The new rating is three notches below Moody’s top Aaa rating.

The downgrade, which puts Moody’s rating in line with other major credit rating agencies, is the latest blow for Japan after its economy remained mired in recession in the second quarter due to tumbling factory production and exports following the March 11 earthquake and tsunami.

Mining shares sank after prices for gold and some other metals slipped. BHP Billiton, the world’s largest mining company, lost 0.1 percent and Fortescue Metals Group Ltd. fell 0.9 percent in Sydney.

Australia’s Macarthur Coal Ltd. rose 1.5 percent after announcing it had nearly doubled its full year profit and repeated its advice to shareholders to reject a takeover offer from U.S energy giant Peabody Energy Corp. and Luxembourg-based steelmaker ArcelorMittal.

Meanwhile, Hong Kong-listed China Life Insurance Co., the country’s biggest life insurer, dropped 11.3 percent after announcing its first-half profit fell 28 percent from a year earlier as premium growth slowed and claims rose.

In New York on Tuesday, buyers returned to the stock market, searching for bargains after reports of better-than-expected manufacturing activity out of China and Europe.

The Dow Jones industrial average closed with a gain of 3 percent at 11,176.76. Indexes that track smaller stocks did even better, a sign that investors were more willing to take on risk. The S&P 500 index rose 3.4 percent to 1,162.35. The Nasdaq composite, which tracks mainly technology companies, rose 4.3 percent to 2,446.06.

Benchmark oil for October delivery was down 9 cents to $85.35 in electronic trading on the New York Mercantile Exchange. Crude rose $1.02 to finish at $85.44 on Tuesday.

In London, Brent crude for October delivery was up 4 cents to $109.35 on the ICE Futures exchange.

In currencies, the euro fell to $1.4402 from $1.4423 in late trading Tuesday in New York. The dollar fell to 76.61 yen from 76.66 Japanese yen.

BANGKOK – Asian stock markets gave up early gains Wednesday after Moody’s Investors Service downgraded Japan’s credit rating.

Japan’s Nikkei 225 index fell 0.2 percent to 8,714.58 after opening higher. South Korea’s Kospi index dropped 1.1 percent to 1,756.81 while Hong Kong’s Hang Seng index lost 0.8 percent to 19,725.73.

Australia’s S&P/ASX 200 index was 0.6 percent up at 4,197. Shares in mainland China and New Zealand were also higher.

Moody’s Investors Service downgraded Japan’s government bond rating to Aa3 from Aa2 late Tuesday. The new rating is three notches below Moody’s top Aaa rating.

The downgrade puts Moody’s Japan rating in line with other major agencies. Both Standard & Poor’s and Fitch rate Japan AA-, three notches below their top AAA ratings.

In May, Moody’s warned it could downgrade Japan after the world’s No. 3 economy slipped back into recession in the first quarter due to tumbling output and exports following the March 11 earthquake and tsunami.

In New York on Tuesday, the Dow Jones industrial average jumped 322 points, following modest gains Monday. Not even an earthquake on the U.S. East Coast on Tuesday afternoon could halt its advance. The Dow dipped about 60 points shortly after the quake hit but soon recovered and soared higher in the last two hours of trading.

Oil rose above $85 per barrel Tuesday following reports of better-than-expected manufacturing activity in China and Europe. Benchmark oil for September delivery was 21 cents higher at $85.65 on the New York Mercantile Exchange.

The contract rose $1.02 to settle at $85.44 per barrel on Tuesday in New York.

In currencies, the euro fell to $1.4405 from $1.4423 in late trading Tuesday in New York. The dollar rose to 76.77 yen from 76.66 Japanese yen

BANGKOK – Asian stocks dropped sharply Monday as the first-ever downgrade of the U.S. government’s credit rating jolted the global financial system, reinforcing fears of a rapid slowdown in economic growth.

Oil prices extended recent sharp losses, trading below $85 a barrel on expectations that slower global growth will crimp demand for crude. The dollar was lower against the yen and the euro.

Among the major Asian markets, Hong Kong’s Hang Seng tumbled 4 percent to 20,109.49 and South Korea’s Kospi slid 3.3 percent to 1,879.93. Japan’s Nikkei 225 stock average was down 1.3 percent to 9,178.03 by its midday break.

Futures pointed to losses on Wall Street when it opens Monday. Dow futures were off 225 points, or 2 percent, at 11,177 and broader S&P 500 futures shed 25.5 points, or 2.1 percent, to 1,172.42.

Standard & Poor’s downgrade of the U.S. sovereign credit rating to AA+ from the top-notch AAA, announced late Friday, was yet another blow to confidence in the struggling U.S. economy. It adds to growing fears that the world’s No. 1 economy may be headed back into recession.

Those anxieties have been compounded by signs that Europe’s government debt crisis is threatening to engulf bigger economies such as Italy and Spain.

David Cohen of Action Economics in Singapore said the downgrade caused already nervous investors to flee riskier assets such as stocks but need not derail the U.S. economic recovery even if it is sluggish.

“Clearly, the downgrade fed the anxiety that was evident in global markets last week,” Cohen said. “But we need not see another global financial crisis as long as people can calm down quickly enough.”

Elsewhere in Asia, Australia’s S&P/ASX 200 index dropped 1.8 percent to 4,030.80. Singapore’s benchmark dived 3.7 percent, Taiwan’s market slid 2.6 percent and China’s Shanghai Composite shed 3 percent.

“I think it’s still a matter of people being cautious given they don’t really know how wildly these overseas markets will respond,” Westpac Banking Corp. chief economist Bill Evans told Australian Broadcasting Corp. television.

“I would expect people will take the risk off the table at the moment waiting for some more clarity in those two big issues: how will the U.S. respond to the downgrade and will the Europeans settle down these concerns in Europe?” he said.

Meanwhile, a flurry of weekend activity by global finance officials gave rise to hopes of coordinated action to prevent a market meltdown.

Seeking to calm the panic spreading across financial markets, finance officials from the Group of Seven industrial countries issued a joint statement late Sunday saying they were committed to taking all necessary measures to support financial stability and growth.

The G-7 statement came after the group held an emergency conference call to discuss the debt crisis in Europe and market prospects following the announcement of the first-ever downgrade of the credit rating of the U.S. government.

The European Central Bank, meanwhile, said it will “actively implement” a bond-purchase program that could boost Spanish and Italian bonds and drive down interest yields that threaten those countries with financial disaster.

The burst of activity underscored how government debt levels in Europe and the U.S. have unsettled financial markets — and sharpened fears that debt troubles could derail the global recovery from the 2007-2009 financial crisis.

The Dow fell 5.8 percent last week amid dour U.S. economic news. It plunged 513 points on Thursday alone, the worst day for the Dow since the global financial crisis erupted in 2008.

Benchmark oil for September delivery was down $2.31 to $84.57 a barrel in electronic trading on the New York Mercantile Exchange. Crude rose 25 cents to settle at $86.88 on Friday.

In London, Brent crude was down $2.46 at $106.91 per barrel on the ICE Futures exchange.

In currencies, the dollar weakened to 78.11 yen from 78.34 yen late Friday in New York. The euro rose to $1.4331 from $1.4265.

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Associated Press Writer Rod McGuirk in Canberra, Australia contributed.