Europe stocks higher, shrug off losses in mar­kets in Asia

The China Post - - MARKETS -

Euro­pean mar­kets opened higher Mon­day as in­vestors shrugged off con­cerns about main­land China’s slow­ing econ­omy that bat­tered Asian stocks ear­lier in the day.

Most Euro­pean mar­kets gained in early trad­ing. Ger­many’s DAX was up 1 per­cent to 11,810.19 and France’s CAC-40 added 0.3 per­cent to 5,159.70. The UK’s FTSE 100 gained 0.6 per­cent to 7,036.12. Fu­tures au­gured a strong start to the week for Wall Street. Dow fu­tures were up 0.6 per­cent at 17,867. S&P 500 fu­tures were 0.5 per­cent higher at 2,086.60.

Asian mar­kets mostly re­treated, while Shang­hai and Hong Kong tum­bled af­ter main­land Chi­nese au­thor­i­ties un­veiled re­stric­tions on deal­ers bor­row­ing cash to trade shares.

The main­land clam­p­down, an­nounced Fri­day, off­set news at the week­end that the PRC’s cen­tral bank had re­duced the amount of cash which banks must keep in re­serve — a bid to boost loan ac­tiv­ity.

Shang­hai sank 1.64 per­cent, or 70.22 points, to 4,217.08 and Hong Kong fell 2.02 per­cent, or 558.19 points, to 27,094.93. Syd­ney shed 0.76 per­cent, or 44.8 points, to close at 5,833.1.

Tokyo stocks ended marginally lower. The bench­mark Nikkei 225 at the Tokyo Stock Ex­change slipped 18.39 points to 19,634.49, while the broader Topix in­dex of all first­sec­tion shares fell 0.38 per­cent, or 6.01 points, to 1,582.68.

In Tokyo share trad­ing, mo­bile car­rier SoftBank was down 1.05 per­cent at 7,583.0 yen, Toy­ota fell 0.42 per­cent to 8,262.0 yen and Fast Re­tail­ing, which op­er­ates the Uniqlo cloth­ing chain, rose 0.65 per­cent to 48,075.0 yen.

ANA Hold­ings, which op­er­ates All Nip­pon Air­ways, edged up 0.05 per­cent to 333.9 yen fol­low­ing a re­port that the car­rier will in­vest 3.5 bil­lion yen in bank­rupt Sky­mark Air­lines to keep Ja­pan’s third-big­gest car­rier afloat.

Seoul closed 0.15 per­cent higher, adding 3.21 points to 2,146.71.

The main­land’s Peo­ple’s Bank of China Sun­day an­nounced it would cut one per­cent­age point off the re­serve ra­tio re­quire­ment, the sec­ond re­duc­tion this year and the lat­est mon­e­tary eas­ing mea­sure aimed at kick­start­ing growth in the world’s num­ber-two econ­omy.

It has also cut in­ter­est rates twice since Novem­ber.

How­ever, on Fri­day the China Se­cu­ri­ties Reg­u­la­tory Com­mis­sion an­nounced tighter rules on mar­gin trad­ing — where in­vestors buy shares mostly with bor­rowed money — which has helped pro­pel the re­cent rally.

At the same time au­thor­i­ties made it eas­ier to short-sell, or bet against stocks.

The Hong Kong and Shang­hai share mar­kets have been soar­ing as in­vestors spec­u­late that Chi­nese main­land au­thor­i­ties will con­tinue to loosen mon­e­tary pol­icy to counter a sharp slow­down.

“In­vestors are tak­ing prof­its in China,” said Jonathan Rave­las, chief mar­ket strate­gist at Manila-based BDO Uni­bank.

“The clam­p­down ini­ti­ated by se­cu­ri­ties reg­u­la­tors is adding to the sell-off and the weak in­vestor sen­ti­ment is spread­ing to other mar­kets in the re­gion,” he told Bloomberg News.

Shang­hai has more than dou­bled over the past year, while Hong Kong has surged about 18 per­cent this year.

Gold fetched US$1,200.30 against US$1,205.91 late Fri­day. In other mar­kets: — Mumbai fell 1.95 per­cent, or 555.89 points, to end at 27,886.21.

Re­liance In­dus­tries fell 4.46 per­cent to 885.55 ru­pees, while Sun Pharam­ceu­ti­cal In­dus­tries rose 0.66 per­cent to 1,044.10 ru­pees.

— Jakarta closed down 0.18 per­cent, or 9.84 points, to 5,400.80.

Palm oil pro­ducer As­tra Agro Les­tari fell 1.19 per­cent to 22,825 ru­piah, while lender Bank Ne­gara In­done­sia rose 1.77 per­cent to 7,175 ru­piah.

— Bangkok closed down 0.42 per­cent, or 6.53 points, at 1,560.32.

— Oil com­pany PTT fell 2.49 per­cent to 352.00 baht, while Siam Com­mer­cial Bank dropped 2.57 per­cent to 170.50 baht.

— Malaysia’s main in­dex gained 0.15 per­cent, or 2.80 points, to close at 1,848.66.

Telekom Malaysia added 0.68 per­cent to 7.40 ring­git, Te­naga rose 0.55 per­cent to 14.52 while May­bank eased 0.11 per­cent to 9.48 ring­git.

— Sin­ga­pore fell 0.62 per­cent, or 21.94 points, to close at 3,503.25.

Sin­ga­pore Air­lines rose 0.50 per­cent to SG$12.00, while Sin­ga­pore Tele­com fell 1.12 per­cent to SG$4.41.

— Welling­ton fell 0.63 per­cent, or 37.21 points, to 5,824.28.

Air New Zealand was down 0.72 per­cent at NZ$2.76 and Cho­rus was off 0.33 per­cent at NZ$3.02.

— Manila slipped 1.03 per­cent, or 81.62 points, to 7,865.27.

(NT$37,216)

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