China un­ease weighs on stocks, lifts yen

The Pak Banker - - MARKETS/SPORTS -

A sharp sell-off in Chi­nese shares dragged world stock mar­kets lower and boosted the safe­haven yen on Wed­nes­day amid re­newed con­cerns about the out­look for China's econ­omy. Tues­day's weak Chi­nese trade fig­ures and slide in oil prices have re­vived global growth con­cerns and prompted in­vestors to push the pause but­ton on a rally in global stocks.

Euro­pean shares .FTEU3 opened higher but held below re­cent one-month highs, while risk aver­sion lifted the Ja­panese yen against the dol­lar JPY= and the euro EURJPY=.

In Asia, Chi­nese shares .SSEC .CSI300 closed more than 1 per­cent lower, while MSCI's broad­est in­dex of Asia-Pa­cific shares out­side Ja­pan .MIAPJ0000PUS fell 0.3 per­cent, down 1.4 per­cent from a two-month high hit on Mon­day.

Ja­pan's Nikkei .N225 ended the day down 0.8 per­cent, its low­est close in a week.

"In­vestors are once again fo­cused to­wards the scanty eco­nomic data over in China and the anx­i­ety is if the Peo­ple's Bank of China has the right tools to help the re­cov­ery," said Naeem As­lam, chief mar­ket an­a­lyst at AvaTrade. China's Fe­bru­ary trade per­for­mance was far worse than econ­o­mists had ex­pected, with ex­ports tum­bling the most in over six years.

Ex­ports dived 25.4 per­cent from a year ear­lier on de­pressed de­mand in all of China's ma­jor mar­kets, while im­ports slumped 13.8 per­cent, the 16th straight month of de­cline.

The overnight sharp slide in oil also proved wor­ri­some for in­vestors al­though crude prices were on firmer ground in early Wed­nes­day trade. Brent crude oil fu­tures LCOc1 hit a high of $39.97 per bar­rel around 0700 GMT be­fore dip­ping back to $39.92, still up 27 cents from their last close and over 40 per­cent higher than the 2016 lows hit in Jan­uary.

U.S. crude fu­tures CLc1 were at $36.70 per bar­rel, up 20 cents from their last set­tle­ment and also over 40 per­cent above Fe­bru­ary's 2016 low.

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