Europe stock markets rise with eyes on US, Greece
Europe’s main stock markets rose on Wednesday, with all eyes on the U.S. economy and interestrate outlook for the world’s biggest economy.
Investors were also acting upon developments over Greece and China, analysts said.
London’s benchmark FTSE 100 index gained 0.19 percent to stand at 6,699.15 points approaching midday in the capital.
Eurozone indices performed better, with Frankfurt’s DAX 30 climbing 1.22 percent to 11,596.13 points and the CAC 40 in Paris up 1.15 percent to 5,170.84 compared with Tuesday’s close.
And Greek’s main stocks index was nearly 4.0 percent down in afternoon deals, with banking shares taking a battering for a third day running.
Athens trading resumed on Monday, five weeks after the government imposed capital controls to prevent a bank run and stave off financial collapse at the height of its standoff with EU-IMF creditors over a new bailout.
The ATHEX index finished Tuesday down 1.22 percent after suffering its steepest ever fall of 16.32 percent on Monday.
Wall Street indices meanwhile finished lower Tuesday following a mixed batch of earnings reports and another big decline by technology giant Apple.
“U.S. markets edged lower, with many on the sidelines ahead of Friday’s U.S. labor market update, and held back by uncharacteristically hawkish comments from Atlanta Fed President Lockhart who said that the Fed is ‘close’ and it would take a significant deterioration in U.S. economic health for him not to support a rate rise from record lows next month,” Accendo Markets said in a note to clients.
“Persistent weakness in Apple also continues to dent confidence.”
Asian Stocks End Mixed
Asian markets were mixed Wednesday as traders assessed the prospects of an early U.S. interest rate rise and China’s moves to stem a recent market rout.
Tokyo put on 0.46 percent, or 93.70 points, to close at 20,614.06, while Seoul ended flat, gaining 1.77 points to 2,029.76.
Sydney lost 0.42 percent, or 23.9 points, to close at 5,674.0, despite big gains by miners on the back of an iron ore price rise.
Hong Kong was up 0.44 percent or 108.04 points to 24,514.16 by close of trading, while Shanghai closed down 1.65 percent, or 61.97 points, at 3,694.57.
China’s benchmark index saw investors take profits after strong gains the previous day sparked by new restrictions on short-selling.
The Shanghai and Shenzhen exchanges said Monday investors who borrow shares must wait until the next day to repay the loans, instead of settling the same day as previously.
“At the expense of its long-term
That measure followed earlier interventions, including banning major shareholders from selling and funding a state-backed firm to buy stocks.
“The government’s unprecedented, rushed market intervention may have supported prices initially but at the expense of its long-term credibility,” Alex Wolf, an economist for emerging markets at Standard Life Investments, told Bloomberg News.
Traders were also taking note of a International Monetary Fund declaration Tuesday that “significant work” needs to be done in reviewing the inclusion of China’s currency in its basket of “special drawing rights” reserve currency.
Tokyo ticked up after a brief slide in opening trade, rising on positive earnings reports and a weaker yen, but analysts advised caution.
Among Japanese firms that have already reported in the latest earnings season, 61 percent exceeded profit expectations, an improvement from the 48 percent that beat forecasts in the previous quarter, according to data compiled by Bloomberg.
“The overseas environment will continue to be a drag on the market,” Hiroichi Nishi, a manager at SMBC Nikko Securities Inc. in Tokyo, told Bloomberg News.
“Lockhart’s comments made the market wary of rate hikes once again. Caution toward the Chinese economy continues to weigh on the market as well.”
U.S. stocks ended lower Tuesday following a mixed batch of earnings reports and a fall by Apple of 3.2 percent, leaving it down more than 12 percent since its July 21 earnings release.
The Dow Jones Industrial Average dropped 0.27 percent. The broad-based S&P 500 fell 0.22 percent, while the tech-rich Nasdaq Composite Index slid 0.19 percent. In other markets:
— Mumbai rose 0.54 percent, or 151.15 points, to end at 28,223.08 points.
— Singapore rose 0.01 percent, or 0.35 points, to 3,191.39.
— Bangkok rose 0.29 percent, or 4.20 points, to 1,436.36.
— Kuala Lumpur gained 0.11 percent, or 1.83 points, to end at 1,725.56.
— Jakarta ended up 1.45 percent or 69.45 points at 4,850.53.
— Wellington was flat, inching ahead 0.08 percent or 4.76 points to 5,938.51.
— Manila closed 0.85 percent or 64.26 points higher at 7,662.55.