China cheers MSCI weight gain, yen takes the strain

LONDON: World markets enjoyed a lively end to an otherwise slow week, with Chinese A- shares leaping after MSCI quadrupled their weight in its global benchmarks and strong US economic data lifting the dollar and bond yields.

China figured heavily in a sudden end- of-week flurry of news that lifted Asia then Europe and helped US futures hop higher as they digested some benign inflation.

China’s blue- chip CSI300 index surged 2.2 per cent to land its best week since November 2015 after index provider MSCI’s boost that could draw more than US$ 80 billion of fresh foreign inflows to the world’s second- biggest economy.

Chinese PMI manufacturing for February had also surprised to the upside, with the fact that it remains in contraction territory helpfully offset by a sharp increase in the forward-looking new orders index component.

It followed Thursday’s official Chinese PMI data which also showed new orders expanding and a stronger-than- expected US GDP figure, while European shares were helped up 0.5 per cent by the fastest rise in German retail sales since October 2016.

“We are seeing a fairly decent uptick in European markets,” said CMC Markets analyst David Madden, citing the combination of the data and some encouraging comments from the United States on China trade talks.

There was still some grizzly news for the bears to claw at. — Reuters

The Lyft transport application is seen on a smartphone in New York City. Lyft’s private valuation has been estimated at US$15 billion, considerably smaller than Uber but making it one of the largest startups worth more than US$1 billion, popularly known as ‘unicorns’. — AFP photos