Global shares boosted by stronger China factory data

TOKYO (AP) – Global shares were mostly higher yesterday, buoyed by further signs of recovery in China’s manufacturing sector.

France’s CAC 40 rose less than 0.1 per cent in early trading to 4,596.48, while Germany’s DAX was up 0.1 per cent at 11,572.39. Britain’s FTSE 100 gained 0.5 per cent to 5,606.97.

United States (US) shares were set to drift higher with Dow futures edging up 0.6 per cent to 26,565.0. S&P 500 futures were also rising 0.6 per cent to 3,284.12.

Japan’s benchmark Nikkei 225 surged 1.4 per cent to 23,295.48, while South Korea’s Kospi gained 1.5 per cent to 2,300.16. Australia’s S&P/ASX 200 added 0.4 per cent to 5,951.30.

Hong Kong’s Hang Seng jumped 1.5 per cent to 24,460.01, while the Shanghai Composite inched up less than 0.1 per cent, to 3,225.12. India’s Sensex advanced 0.8 per cent.

The Caixin manufacturing PMI, a major indicator for China’s manufacturing sector, rose in October, showing that domestic demand is holding up, reports said over the weekend.

Data for Japan and India also were encouraging.

People walk past a bank’s electronic board showing the Hong Kong share index at Hong Kong Stock Exchange. PHOTO: AP

But if coronavirus cases continue to rise in the US and Europe, that’s likely to hurt China’s exports. The resurgence of outbreaks of COVID-19 has investors worried, on top of uncertainty over the US presidential election.

The US government’s top infectious diseases expert has cautioned that the US will have to deal with “a whole lot of hurt” in the weeks ahead due to surging coronavirus cases. Dr Anthony Fauci said in a Washington Post interview that the US “could not possibly be positioned more poorly” to stem rising cases as more people gather indoors during the colder fall and winter months.

Aside from pandemic and election concerns, market players are looking ahead to a slew of earnings reports expected from Japan and the rest of the region, including automakers and video-game maker Nintendo Co.

“With voters in the US going to the polls this week, or more accurately, not going to the polls, having already cast their postal votes in huge numbers, Asia will be looking nervously westwards this week, wondering what the outcome will be, and that it will mean for them,” said Robert Carnell, regional head of research for ING.

The focus is on US-China relations, but investors aren’t sure what change either outcome might bring on that issue. Although Democratic candidate Joseph Biden might go easier on tariffs, he is unlikely to soften US policy on other issues such as human rights, Carnell said in a report.

Last week proved punishing for Wall Street, with the S&P 500 posting its first back-to-back monthly loss since the coronavirus pandemic first gripped the economy in March. Investors have been cashing in gains from the recovery in the past several months, moving to lock in profits ahead of the election.

In energy trading yesterday, benchmark US crude slipped USD1.24 to USD34.55 a barrel in electronic trading on the New York Mercantile Exchange. It lost 38 cents to USD35.79 per barrel on Friday. Brent crude, the international standard, fell USD1.12 to USD36.82 a barrel.

The US dollar inched up to JPY104.93 from JPY104.66. The euro cost USD1.1630, down slightly from USD1.1648.