Euro­pean shares re­verse early losses

The China Post - - BUSINESS INDEX & -

Euro­pean shares re­bounded from early losses on Wed­nes­day as a monthly sur­vey showed fac­tory out­put at a 10-month high in March, helped by strong growth in new busi­ness. Asian mar­kets were lack­lus­ter af­ter weak data from China and Ja­pan.

Ger­many’s DAX rose 0.4 per­cent to 12,012.18 and the United King­doms’s FTSE 100 gained 0.5 per­cent to 6,805.65. France’s CAC-40 ad­vanced 0.6 per­cent to 5,064.22. Wall Street ap­peared poised for a weak start, how­ever, with S&P 500 fu­tures 0.5 per­cent lower at 2,050.60.

A sur­vey of man­u­fac­tur­ers in coun­tries us­ing the euro found the strong­est im­prove­ment in busi­ness con­di­tions in 10 months. Markit’s pur­chas­ing man­agers in­dex was at 52.2, com­pared with 51.0 in March. Read­ings above 50.0 im­ply ex­pan­sion.

“Pro­duc­ers are ben­e­fit­ing from the weaker euro,” Chris Wil­liamson, Markit’s chief econ­o­mist, wrote in a com­men­tary. “New or­ders are con­se­quently show­ing the best growth for nearly a year.”

Asian Mar­kets Mostly Slip, Shang­hai Up on China Data

Asian mar­kets mostly re­treated Wed­nes­day fol­low­ing losses on Wall Street, with Tokyo also hurt by a dis­ap­point­ing read­ing of Ja­panese busi­ness con­fi­dence.

But Hong Kong and Shang­hai climbed on fig­ures show­ing a re­bound in Chi­nese man­u­fac­tur­ing ac­tiv­ity.

Af­ter a strong per­for­mance for global eq­ui­ties this year, an­a­lysts have warned of a rocky road ahead in the near term, with Greece’s debt cri­sis still un­re­solved, volatil­ity in oil prices and un­cer­tainty over U.S. in­ter­est rates.

Tokyo tum­bled 0.90 per­cent, or 172.15 points, to fin­ish at 19,034.84, Seoul closed 0.62 per­cent lower, giv­ing back 12.58 points to end at 2,028.45 and Syd­ney fell 0.52 per­cent or 30.71 points to 5,860.8.

How­ever, Shang­hai surged 1.66 per­cent, or 62.39 points, to 3,810.29 — its high­est close since March 17, 2008. And Hong Kong added 0.73 per­cent, or 181.86 points, to 25,082.75.

Af­ter an im­pres­sive three months that saw big gains in some mar­kets — in­clud­ing a 10 per­cent rise in Tokyo and 8 per­cent in Syd­ney — in­vestors took to the side­lines Wed­nes­day as they keep track of var­i­ous global events.

“This is go­ing to be a tougher quar­ter and you can ex­pect higher volatil­ity,” Nader Naeimi, Syd­ney­based head of dy­namic as­set al­lo­ca­tion at AMP Cap­i­tal In­vestors, told Bloomberg News.

Close at­ten­tion is be­ing paid to Greece, where the anti-aus­ter­ity gov­ern­ment is try­ing to ham­mer out new terms for its multi-bil­lion-U.S.dollar bailout.

How­ever, it is strug­gling to come up with pro­pos­als that will sat­isfy its cred­i­tors, chiefly pay­mas­ter Ger­many, and re­lease much-needed cash to help it avoid a de­fault and a likely exit from the eu­ro­zone.

In New York Tues­day the Dow sank 1.11 per­cent, the S&P 500 fell 0.88 per­cent and the Nas­daq dropped 0.94 per­cent.

Ja­pan’s Fragility

Adding to un­cer­tainty on Wed­nes­day was Ja­pan’s closely watched Tankan sur­vey of busi­ness con­fi­dence, which came in be­low ex­pec­ta­tions, high­light­ing the fragility in the world’s num­ber three econ­omy.

The sur­vey of more than 10,000 com­pa­nies — mark­ing the dif­fer­ence be­tween the per­cent­age of firms that are op­ti­mistic and those that see con­di­tions as un­fa­vor­able — is the most com­pre­hen­sive in­di­ca­tor of how Ja­pan Inc. is faring.

“The Tankan showed that firms, par­tic­u­larly man­u­fac­tur­ers, are now acutely aware that over­seas de­mand is soft­en­ing,” said a re­port by SMBC Nikko Se­cu­ri­ties.

Gold fetched US$1,183.55 against US$1,183.06 late Tues­day. In other mar­kets: — Welling­ton was flat, edg­ing up 1.60 points to 5,835.58.

— Manila closed 0.51 per­cent higher, adding 40.56 points to 7,981.05.

— Kuala Lumpur dropped 0.24 per­cent, or 4.47 points, to close at 1,826.31.

— Jakarta fell 0.94 per­cent, or 51.81 points, to 5,466.87.

— Sin­ga­pore closed 3,447.02.

— Bangkok rose 1.30 per­cent, or 19.64 points, to 1,525.58.

— Mumbai rose 1.08 per­cent, or 302.65 points, to 28,260.14.

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