World shares mixed as investors watch talks on US stimulus

AP – Stocks were mixed in Europe and Asia yesterday as investors watched to see if lawmakers will come ahead with fresh stimulus for a United States (US) economy struggling with shutdowns as new coronavirus outbreaks flare.

Germany’s DAX gained 0.5 per cent to 12,727.71 while the CAC 40 in Paris slipped 0.2 per cent to 4,924.39. Britain’s FTSE 100 fell 1.3 per cent to 6,024.60. The future for the S&P 500 edged 0.1 per cent higher while the contract for the Dow industrials picked up 0.2 per cent.

In Asian trading, Tokyo’s Nikkei 225 index shed 0.4 per cent to 22,418.15 while the Shanghai Composite index gained 0.3 per cent, clawing back losses in last minute buying to close at 3,386.46. Hong Kong lost 0.7 per cent to 24,930.58.

South Korea’s Kospi added 1.3 per cent, closing at 2,342.61 after Samsung Electronics, the country’s biggest company, unveiled three new models of smartphones it hopes will revive its sinking sales.

Samsung’s shares rose 1.9 per cent.

Australia’s S&P/ASX 200 added 0.7 per cent to 6,042.20, lifted by strong gains in commodity prices on expectations that China’s economy is on the mend after the country largely recovered from the pandemic.

People walk by the New York Stock Exchange. PHOTO: AP

The S&P 500 index logged its fourth straight gain on Wednesday, pulling within 1.7 per cent of the record high it set in February. It picked up 0.6 per cent to 3,327.77 as negotiators on Capitol Hill reported some progress in talks for more support for the economy as pressure mounts for quicker action.

Overall, “stocks remain underpinned by optimism over the coronavirus relief bill. Democrats and the White House are inching closer to a deal, and the market remains cheery an agreement can be signed off by the end of the week,” Stephen Innes of AxiCorp said in a commentary.

A report released on Wednesday suggested that US hiring was far weaker last month than economists expected. Private employers added just 167,000 jobs, according to a survey by payroll processor ADP, well below the 1.2 million that economists had forecast.

A more comprehensive jobs report from the Labor Department is due today.

Rising caseloads of the coronavirus remain a concern, however, with officials in Spain warning of a relapse while numbers continue to mount in the US.

In Hong Kong, authorities reported 85 newly confirmed cases, almost all of them untraceable or locally transmitted. In Japan, the governor of Aichi Prefecture, where Toyota Motor Corp has its headquarters, declared a state of emergency through August 24, saying newly confirmed cases have been rising by more than 100 daily. Before that, daily cases had been zero for extended periods.

Governor Hideaki Ohmura told reporters businesses are being asked to close altogether or close early, and people are being asked to stay home at night, to prevent infections from spreading.

Japan has largely sought to avoid major shutdowns, partly because of laws limiting the government’s powers.

In Washington, Congress and White House officials are negotiating on more aid for an economy that’s shown some improvement but is still hobbling.

Investors say such a package is crucial and needs to arrive quickly, with millions of Americans still out of work and USD600 in weekly unemployment benefits from the US government having recently expired.

Treasury yields sipped, with the yield on the 10-year Treasury at 0.51 per cent, down from 0.54 per cent late Wednesday. Yields have remained very low as investors have continued to worry about the weak economy and as the Federal Reserve has unleashed massive amounts of stimulus.

Gold rose even further into record territory, continuing its strong climb since the spring amid nervousness about the economy and super-low interest rates.

Gold for delivery in December, the most actively traded contract, rose USD7.80 to USD2,057 per ounce.

Benchmark US crude fell back, giving up 33 cents to USD42.86 per barrel in electronic trading on the New York Mercantile Exchange.

Brent crude, the international standard, lost 14 cents to USD45.02 a barrel.

In currency dealings, the US dollar was flat at JPY105.58. The euro fell to USD1.1739 from USD1.1868.