Global markets slumped on Friday amid concerns that the Fed may reduce its stimulus program as soon as this September and signs that the U.S. economy did not perform as projected.

European stocks dropped, paring their biggest weekly gain in almost two months, as technology companies retreated and a measure of business activity in the U.S. fell more than economists had estimated.

The Stoxx 600 declined 0.5% to 285 at the close of trading, after earlier advancing as much as 0.4% earlier.

In London, the FTSE 100 shed 28 points (-0.5%) to settle at 6215 while the German DAX dropped 32 points (-0.4%) to close trading at 7959.

U.S. stocks fell, with the S&P 500 Index snapping a streak of seven monthly gains, as comments from Federal Reserve Governor Jeremy Stein spurred concern the central bank may begin to reduce stimulus as early as September.

The S&P 500 fell 0.4% to 1606 and extended the decline into the close of trading as investors adjusted positions at end of the quarter. The Dow lost 115 points (-0.8%) to finish at 14910.

Gold rebounded from a 34-month low, jumping the most in a month, on signs of increased demand for jewelry, coins and bars after the metal headed for the biggest quarterly drop in at least 93 years.

On the Comex in New York, gold futures for August delivery rose 1% to settle at $1223.70.

Crude oil fell for the first time in five days as the U.S. dollar strengthened to a three-week high against other major currencies. Crude for August delivery slid 49 cents (-0.5%) to settle at $96.56 a barrel on the New York Mercantile Exchange after rising to $97.82 earlier.

The Melbourne Institute will release its monthly MI Inflation Gauge report today, at 10:30am. The Reserve bank of Australia is expected to release the monthly Commodity Prices report, at 4:30 pm.

Morning Market Update: New Financial Year is a post from: Australian Stock Report Market Pulse Blog