World stocks decline on global growth concerns
singapore — World stocks were mostly lower on Thursday ahead of the European Commission’s economic forecasts.
Germany reported its industrial production slipped 0.4 per cent in December from the previous month, way below the 0.9 per cent gain analysts had expected. The latest data follows a 1.6 per cent decline in factory orders in December compared with a month earlier, raising fears Europe’s largest economy is slowing.
Germany’s DAX dropped 0.5 per cent to 11,265.02 and the CAC 40 in France shed 0.2 per cent to 5,071.51. Britain’s FTSE 100 edged 0.1 per cent higher to 7,178.82, as traders focused on Prime Minister Theresa May’s return to Brussels to seek assurances on an exit deal. Wall Street was set to open lower. The future contract for the Dow Jones Industrial Average lost 0.1 per cent to 25,293.00. That for the S&P 500 shed 0.2 per cent to 2,724.30.
News that the Reserve Bank of Australia may cut interest rates boosted several Asian indexes. The Philippine central bank kept its rates intact after a meeting on Thursday, but India’s central bank issued a surprise rate cut and changed its stance from “calibrated tightening” to neutral.
When borrowing is made less expensive, the increase in spending by businesses and consumers could give the economy boost. The Bank of England is expected to announce it is keeping its policy rate unchanged in an announcement later Thursday.
Japan’s Nikkei 225 dropped 0.6 per cent to 20,751.28 on concerns over US-China relations. US Treasury Secretary Stephen Mnuchin and trade representative Robert Lighthizer will lead a delegation to Beijing next week for the next round of trade talks, but the issues at hand are complex.
These include contentious issues like Beijing’s technology policy and trade practices, where progress has been limited so far.
Mnuchin also said that there were no plans for President Donald Trump to meet Chinese leader Xi Jinping. “If there are remaining issues that we can’t get closed, I think President Trump expects that he’s going to sit down with President Xi and address those issues,” he said. Australia’s S&P ASX 200 gained 1.1 per cent and New Zealand’s NZX index advanced 0.7 per cent. South Korea’s Kospi was flat, while India’s Sensex picked up 0.3 per cent. Stocks rose in Singapore and
1.6% Drop in Germany’s factory orders in December
the Philippines but fell in Thailand and Indonesia. Markets in China, Hong Kong and Taiwan were closed for Lunar New Year.
Oil steadied on Thursday as growing expectations that global supply could fall significantly short of demand this year lent support, offsetting the negative impact of a rise in US inventories. Brent crude oil futures were last down 12 cents at $62.57 a barrel by 1022 GMT, while US crude futures were down 7 cents at $53.94 a barrel.
Gold was trading close to a more than one-week low on Thursday weighed by a stronger dollar but uncertainties around the Sino-US trade spat and concerns about slowing global growth supported the metal above the key $1,300 level.
Spot gold was steady at $1,306.08 per ounce by 1022GMT, after touching its lowest since Jan. 29 at $1,302.11. Prices fell 0.7 per cent in the previous session in their biggest one-day drop since January 18.
The dollar eased to 109.97 yen from 109.99 yen late Wednesday. The euro slipped to $1.1340 from $1.1363. The British pound was trading at $1.2897, down from $1.2932.