By Carla Mozee, MarketWatch Japan GDP shock follows weak eurozone growth

LONDON (MarketWatch) -- U.K. stocks pulled back Monday, losing ground alongside other global markets after Japan's economy -- the third-largest in the world -- unexpectedly fell into recession.

The FTSE 100 lost 0.2% to 6,643.09, with the trading week starting on negative footing after Japan said real gross domestic product shrank 1.6% in the third quarter, as companies cut inventories and capital investment was subdued. None of the 18 economists surveyed by The Wall Street Journal had forecast Japanese contraction.

European stocks also fell after Japan's Nikkei Stock Average slumped 3% following the dour GDP update. In London, shares of Asia-focused Standard Chartered PLC fell 2.4%, and HSBC Holdings PLC (HSBC) moved down 1.1%.

News of contraction in Japan comes just days after the release of lackluster growth data from the eurozone, the U.K.'s largest trading partner.

Also trading lower was engineering firm Weir Group PLC , whose business includes work in the oil-and-gas market. The shares were shot down 3.6% following a rating downgrade to underperform from outperform at Exane BNP Paribas, with analysts saying the weakness in oil prices could result in a 25% cut in rig count.

But an upgrade of ARM Holdings PLC at Exane to outperform sent shares of the chip designer up by 2%.

Meanwhile, AstraZeneca PLC fell 2% after U.S. drug maker Pfizer Inc. (PFE) said it's teaming up with Germany's Merck KGaA to develop an anti-cancer tumor treatment. Pfizer will make an upfront payment of $850 million to Merck as part of the deal, leading Pfizer (PFE) to cut its 2014 earnings forecast.

You're invited: A free evening event focusing on investing opportunities in Europe

Will you be in London on Dec. 3? Then you're invited to our MarketWatch Investing Insights event, "The worse Europe gets, the more you should invest."

Governments are in trouble, reform efforts have stalled, unemployment is climbing. the news from the eurozone is bleak. And investors are fleeing. But that's a mistake: The worse the economic data from Europe get, the more you should be buying. Why? Because actions by the ECB will boost asset prices and the stock market in particular. And, big exporters can grow sales. Lower costs and steady sales translate into higher profits and dividends. Join us for an evening of cocktails and conversation to explore these opportunities.

Our panel will be led by MarketWatch Columnist Matthew Lynn, a renowned financial journalist based in London and the author of "Bust: Greece, the euro and the Sovereign Debt Crisis." He'll be joined by Mark Hulbert, MarketWatch columnist and editor of the Hulbert Financial Digest.

This event is free, but RSVPs are required. It will be held Wednesday evening, Dec. 3, in London. For more information or to RSVP, send an email to marketwatchevent@wsj.com

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