World stock markets drift ahead of reports on U.S. economy after strong run

By The Canadian Press - Monday, January 28, 2013 at 4:31 AM - 0 Comments

LONDON – Markets have begun the new week sluggishly after a buoyant start to the year where many of the world’s major stock indexes have been trading at multiyear highs.

With little to catch investors’ eyes, trading has been muted Monday, particularly in Europe. However, a raft of economic data and corporate earnings over the week, particularly out of the U.S., should see the tempo pick up.

“The rally which has propelled equities higher in recent weeks shows some signs of abating as we are seeing retail investors starting to rein in their appetite for risk,” said Mike McCudden, head of derivatives at Interactive Investor. “Furthermore, with corporate earnings thin on the ground today, investors are struggling to find the drivers in the short term which will push equities on to new highs and may well take this opportunity to bank some profits.”

In Europe, the FTSE 100 index of leading British shares was flat at 6,283, while the CAC-40 in France was more or less unchanged at 3,776. Germany’s DAX was 0.1 per cent lower at 7,854.

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World stock markets fall ahead of a vote in the U.S. House to raise the debt ceiling

By The Associated Press - Wednesday, January 23, 2013 at 4:00 AM - 0 Comments

BANGKOK – World stock markets fell Wednesday ahead of a U.S. vote on raising the nation’s borrowing limit.

Analysts said, however, that stock markets have room for gains if U.S. lawmakers make progress on raising the debt ceiling. The House is set to vote on a motion to increase the nation’s $16.4 trillion borrowing authority for three months.

Without congressional action, the Treasury sometime in late February or early March will not have enough money to pay for all of its obligations, creating the possibility of a first-ever default on the government’s debts.

“A vote is expected today, and if it is passed as expected it should clear the very short term obstacles for risk appetite, although battles on automatic spending cuts and the budget itself are not so long away,” said analysts at Credit Agricole CIB in a market commentary.

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World stock markets mixed after Bank of Japan defers big policy easing for a year

By The Associated Press - Tuesday, January 22, 2013 at 4:11 AM - 0 Comments

BANGKOK – World stock markets were mixed Tuesday after Japan’s central bank promised open-ended monetary easing like the U.S. Federal Reserve but said it won’t start for a year.

The Bank of Japan concluded a two-day policy meeting by setting a 2 per cent inflation target and announcing open-ended asset purchases that will pump money into the financial system.

Prime Minister Shinzo Abe has been pressuring the central bank to take aggressive new measures to reverse years of economically debilitating deflation.

Markets appeared underwhelmed by the BOJ announcements. Analysts at Capital Economics called the asset purchase program “pretty timid” since it will not be introduced until January 2014. An existing asset purchase scheme will continue until then. The yen rose against the dollar as expectations of significantly easier monetary policy in the near term were diminished.

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Stocks tentative as Bank of Japan meets, debt ceiling impasse lingers

By The Associated Press - Monday, January 21, 2013 at 5:22 AM - 0 Comments

BANGKOK – World stock markets made limited gains Monday amid a holiday in the U.S. and nervousness over whether political leaders in Washington will be able to reach a deal on the government’s debt limit.

Congress must agree to raise the limit on how much debt the U.S. can have by the end of February otherwise the country risks default and could be slapped with damaging credit downgrades.

Even if the ceiling is raised, it would likely be at the cost of deep spending cuts demanded by Republicans in Washington.

“Markets remain optimistic, mainly because failure to forge a deal would be a disaster,” analysts at Credit Agricole CIB in Hong Kong said in a report. “However, the more time that passes the more nervous markets should become.”

European stocks rose in early trading, while Asian markets were more restrained. Britain’s FTSE 100 rose 0.7 per cent to 6,177.18. Germany’s DAX advanced 0.4 per cent to 7,735.52 and France’s CAC-40 gained 0.2 per cent to 3,748.46.

U.S. stock and bond markets are closed for Martin Luther King, Jr. Day.

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World stock markets rise as U.S., China show new signs of economic recovery

By The Associated Press - Friday, January 18, 2013 at 4:08 AM - 0 Comments

BANGKOK – World stock markets rose Friday after signs that the U.S. economic recovery is gaining traction and a rebound in China’s growth emboldened investors to plunge back into equities. The Nikkei soared as the yen continued to weaken.

China’s economy grew 7.9 per cent in the fourth quarter of 2012, up from the previous quarter’s 7.4 per cent. Stronger quarterly growth was widely expected after earlier data showed retail sales, factory output and other indicators rising.

“Such an outcome should put to rest any remaining doubt about China escaping a hard landing and sailing smoothly through the troubled global waters,” Dariusz Kowalczyk of Credit Agricole CIB in Hong Kong said in an email.

European stocks rose in early trading. Britain’s FTSE 100 rose 0.3 per cent to 6,150.63. Germany’s DAX rose 0.2 per cent to 7,748.77 and France’s CAC-40 added 0.4 per cent to 3,757.85.

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World stock rise ahead of data later this week expected to underscore China recovery

By The Associated Press - Monday, January 14, 2013 at 5:16 AM - 0 Comments

BANGKOK – World stock markets rose Monday on optimism that China’s economic recovery is firmly taking root.

Many analysts expect China’s fourth quarter and 2012 growth figures due Friday to show the world’s No. 2 economy continuing to bounce back from its worst slump since the 2008 financial crisis.

Sentiment improved last week after Japan announced a $224 billion stimulus package to boost its recession- and deflation-mired economy. A strong economic recovery has eluded Japan for more than 20 years since the bursting of its financial bubble in the early 1990s.

Britain’s FTSE 100 rose marginally to 6,123.87. Germany’s DAX gained 0.2 per cent to 7,727.68. France’s CAC-40 added 0.2 per cent to 3,713.79.

Wall Street was set for slight gains, with Dow Jones industrial futures rising slightly to 13,437 while S&P 500 futures gained 0.1 per cent to 1,468.20.

Stock markets in Asia posted gains as investors grew more confident about China’s economic recovery. China reported improving exports and imports last week, a sign of higher demand both inside and outside the country. More signs of improvement are expected when China releases a slew of data on Friday, including factory output, investment and retail sales.

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Asian stocks up, Europe mixed as U.S. leaders prepare new round of ‘fiscal cliff’ talks

By The Associated Press - Friday, December 28, 2012 at 6:51 AM - 0 Comments

BANGKOK – Asian stock markets rose Friday, hours before President Barack Obama and key lawmakers were to meet at the White House to try to hammer out an 11th-hour budget compromise to avert the so-called fiscal cliff. Wall Street also appeared set for a session of gains.

Lawmakers have until Monday night to reach a deal before hundreds of billions of dollars in automatic tax increases and deep cuts to government spending kick in. Such a drastic reshuffling of money could throw the U.S. into another recession, economists have warned.

However, failure to avoid the fiscal cliff doesn’t necessarily mean tax increases and spending cuts would become permanent, since the new Congress could pass legislation cancelling them retroactively after it begins its work next year.

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Asian stock markets rise as Japanese Cabinet resigns to make way for new leaders

By Pamela Sampson, The Associated Press - Wednesday, December 26, 2012 at 7:53 AM - 0 Comments

BANGKOK – Asian stock markets rose Wednesday as traders snapped up stocks before the end of the year, while the Tokyo benchmark hit a nine-month high after a new, pro-business government prepared to assume leadership in a country plagued for years by economic lethargy.

Japan’s Nikkei 225 index surged 1.5 per cent to close at 10,230.36 as a further weakening yen gave momentum to the country’s major exporters. That was its highest close since March 27.

Incoming Prime Minister Shinzo Abe has put pressure on the Bank of Japan to raise its inflation target from 1 to 2 per cent to extricate the country from two decades of deflation — continually dropping prices — which has deadened economic activity.

Abe named a new Cabinet on Wednesday, following the resignation of Prime Minister Yoshihiko Noda’s government. Abe has urged the central bank to take steps to dampen the strength of the country’s currency. A strong yen has hobbled big exporters like Toyota by eroding the value of repatriated earnings and making Japanese products more expensive overseas.

Abe has also called for aggressive public works spending to invigorate a languid economy.

South Korea’s Kospi rose marginally to 1,982.25. Stocks in mainland China, Singapore, Indonesia and the Philippines also rose. The gains were reflective of investors with extra cash wanting to avoid missing out on an end-of-the-year rally.

“People want to get invested. In previous years, we’ve seen good rallies around the end of the year,” Hong Kong-based analyst Andrew Sullivan said in a recent interview.

Markets in Hong Kong, Australia and New Zealand were closed for holidays. Most markets in Europe reopen Thursday.

Among individual stocks, Japan’s Fujitsu Ltd. rose 4.1 per cent. Sharp Corp. soared 15.4 per cent.

Yonhap News Agency said South Korean mobile carriers fell after being fined for discriminative subsidies. SK Telecom Co., South Korea’s top mobile carrier, fell 0.6 per cent.

On Wall Street on Monday, the last day of trading before Christmas, stocks fell on concern that time is running out for lawmakers to reach a budget deal to avoid the U.S. going over the “fiscal cliff.” U.S. stock markets reopen Wednesday.

For weeks, discussions between the White House and Congress over a budget deal have been the main driver in markets. If a deal isn’t reached by the start of 2013, automatic spending cuts and tax increases worth hundreds of billions of dollars will be imposed — which many economists think could push the U.S. economy back into recession.

Benchmark oil for February delivery rose 45 cents to $89.06 per barrel in electronic trading on the New York Mercantile Exchange. The contract closed down 5 cents to $88.61 a barrel on the Nymex on Monday.

In currencies, the euro rose to $1.207 from $1.3192 late Monday in New York. The dollar rose to 85.36 yen from 84.23 yen.

Japan stocks rise after pro-stimulus party wins vote

By The Associated Press - Sunday, December 16, 2012 at 10:58 PM - 0 Comments

HONG KONG – Stock markets in Japan and China, Asia’s two biggest economies, rose Monday after Japanese conservatives who favour greater economic stimulus returned to power in a landslide election victory and China’s new leaders promised more spending if needed to underpin a wobbly economic recovery.

Japan’s Nikkei 225 index jumped 1.6 per cent to 9,891.15, its highest level since April, after the country’s Liberal Democratic Party swept back into power at weekend elections. Party chief Shinzo Abe, almost certain to become prime minister, favours increased spending on public works and setting a 3 per cent economic growth target.

“The outcome of the Japan election should help support sentiment in the region,” strategists at Credit Agricole CIB said in a research note.

In mainland China, the Shanghai Composite index rose 0.8 per cent to 2,168.00 and the smaller Shenzhen Composite index climbed 0.6 per cent to 821.17. On Sunday, China’s new Communist Party leaders under party General Secretary Xi Jinping pledged a “proactive fiscal policy” and “prudent monetary policy” in a statement carried by the official Xinhua News Agency. They were references to the willingness to boost spending if needed and keep credit easy so long as inflation stays low.

The optimism failed to rub off on other Asian markets, which retreated slightly.

South Korea’s Kospi was less than 0.1 per cent lower at 1,994.04 and Hong Kong’s Hang Seng was down 0.1 per cent at 22,584.98. Australia’s S&P/ASX 200 shed 0.2 per cent to 4,574.90. Benchmarks in Taiwan and New Zealand also fell.

On Wall Street on Friday, the Dow fell 35.71 0.3 per cent to close at 13,135.01 while the Standard & Poor’s 500 index fell 0.4 per cent to 1,413.58. The Nasdaq composite sank 0.7 per cent to 2,971.33.

In currencies, the euro weakened slightly to $1.3155 from $1.3159 in late trading Friday. The dollar fell to 83.99 Japanese from 83.46 yen.

Crude prices rose. Benchmark oil for January delivery was up 18 cents to $86.91 per barrel in electronic trading on the New York Mercantile Exchange. The contract settled at $86.73 on Friday.