Europe stock mar­kets rise with eyes on US, Greece

The China Post - - BUSINESS INDEX & -

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

cred­i­bil­ity”

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.

Wary Mar­ket

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.

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