HONG KONG (AP) – Global stocks were mixed yesterday after stocks in the United States (US) pulled closer to their record highs following economic reports that came in close to expectations.
European markets were mostly higher in early trading yesterday after the European Central Bank reduced interest rates again on Thursday to support sluggish growth as inflation continues to subside. France’s CAC 40 rose 0.3 per cent to 7,454.10, and Germany’s DAX added 0.4 per cent to 18,595.43. Britain’s FTSE 100 edged down 0.1 per cent to 8,234.25.
Futures for the S&P 500 climbed 0.2 per cent and those for the Dow Jones Industrial Average were 0.1 per cent higher.
Chinese authorities imposed a six-month ban on the accounting firm PwC yesterday and fined it over CNY400 million (USD56.4 million) for its involvement in the audit of Evergrande, the world’s most indebted property developer, which has collapsed. The punishment is the heaviest yet for international accounting firms operating in China.
Hong Kong’s Hang Seng rose 0.8 per cent to 17,369.09, while the Shanghai Composite was down 0.5 per cent at 2,704.09 after China’s legislature announced yesterday that it would raise the retirement age from 60 to 63 years for men and from 50 to 55 or 58 years for women, according to state media. The Chinese Academy of Sciences said the pension system may run out of money by 2035 because of the current economic slump and an ageing population.
China is also set to release its monthly economic data today, with market predictions that the three key indicators – industrial production, fixed asset investment and retail sales – will show a slowdown.
Japan’s benchmark Nikkei 225 slipped 0.7 per cent to close at 36,581.76 after data released yesterday showed the nation’s industrial production increased 2.9 per cent year-on-year in July, signalling improved demand in the manufacturing sector.
The dollar fell to JPY141.68 from JPY141.79, adding pressure on Japan’s exports.
“The Bank of Japan is not expected to make any rate move at its meeting next week, but there may be some hawkish pricing brewing for policymakers to lay the groundwork for further rate hikes in December and beyond,” said IG market analyst Yeap Jun Rong.
Elsewhere, Australia’s S&P/ASX 200 rose 0.3 per cent to 8,099.90. South Korea’s Kospi picked up 0.1 per cent to 2,575.41.
On Thursday, the S&P 500 rose 0.7 per cent to 5,595.76, climbing back to within 1.3 per cent of its record set in July following a shaky summer. It’s on track for a fourth winning week in the past five.
The Dow Jones Industrial Average added 0.6 per cent to 41,096.77, and the Nasdaq composite gained one per cent to 17,569.68.
One report said the number of US workers applying for unemployment benefits last week ticked up, though it remains low relative to history. Another said prices charged at the wholesale level were 1.7 per cent higher in August than a year before. That’s a slowdown from July’s inflation rate, but an underlying measure that economists see as a better predictor of future trends also ticked up more than expected.
The inflation data was similar to Wednesday’s report on prices at the US consumer level. It kept traders betting the Fed will deliver a traditional-sized cut of a quarter of a percentage point next week, instead of the larger half-point that some had been expecting.
While lower interest rates help goose the economy and investment prices, they can also give inflation more fuel.
In energy trading, benchmark US crude gained 48 cents to USD69.45 a barrel. Brent crude, the international standard, added 50 cents to USD72.47 a barrel.
The euro cost USD1.1088, up from USD1.1074.
