Alexa
  • Directory of Taiwan

US data buoys world markets

US data buoys world markets

Stock markets in Europe and the U.S. spiked higher Thursday after better than expected U.S. jobs and trade data further eased concerns that the world's largest economy was heading back towards recession.
In Europe, the FTSE 100 index of leading British shares was up 71.46 points, or 1.3 percent, at 5,501.20 while Germany's DAX rose 58.81 points, or 1 percent, to 6,223.25. The CAC-40 in France was 50.59 points, or 1.4 percent, higher at 3,727.80.
On Wall Street, the Dow Jones industrial average was up 75.49 points, or 0.7 percent, at 10,462.50 soon after the open while the broader Standard & Poor's 500 index rose 11.14 points, or 1 percent, to 1,110.01.
Wall Street's open was better than had been anticipated before the upbeat economic news, and helped European shares extend their gains.
The U.S. government reported that initial U.S. jobless claims fell by more than anticipated last week to a two-month low of 451,000 from the previous week's 478,000 _ the consensus in the markets was for claims to total 470,000.
The simultaneous release of a bigger than anticipated 14 percent narrowing in the U.S. trade deficit for July to $42.8 billion shored up confidence in the markets further.
"While the recent deterioration in employment situation is showing signs of moderating, the trade deficit is benefiting from declining import demand on softening economic growth," said Michael Woolfolk, an analyst at Bank of New York Mellon.
Earlier, sentiment in the markets had continued to be supported by waning fears over an escalation in Europe's debt crisis following a successful Portuguese bond auction _ on Tuesday, investors had been spooked by a Wall Street Journal report suggesting that this summer's stress tests into 91 EU banks understated some lenders' holdings of potentially risky government debt.
In the currency markets, the main point of interest remains the value of the yen, which hit another 15-year high against the dollar Wednesday.
The dollar's drop to 83.35 yen has reignited talk that Japan's monetary authorities will intervene to stem the export-sapping appreciation of the Japanese currency, especially as Japanese finance minister Yoshihiko Noda said that simulated interventions are currently being conducted.
"Coordinated action may be a distant prospect, but unilateral intervention cannot be ruled out," said Daragh Maher, deputy head of global foreign exchange strategy at Credit Agricole.
The yen's earlier decline had helped Japan's Nikkei advance 0.8 percent to 9,098.39.
However, since Japan's markets closed, the yen has strengthened once more _ by mid afternoon London time, the dollar was down 0.2 percent at 83.73 yen.
The euro meanwhile was up 0.2 percent at $1.2744 as the strong U.S. data boosted supposedly riskier trades _ when investors are fretting about issues of global concern, the dollar usually gains support from its safe haven capacity.
"The combination of lower claims and a smaller deficit is ostensibly dollar positive," said Alan Ruskin, a currency strategist at Deutsche Bank. "Nonetheless, the euro ticked up on the numbers, as positive risk trades, associated with a weaker dollar, trumped all."
The pound was down 0.2 percent at $1.5437, with sentiment further dented by news of the biggest British trade deficit since August 2005.
The country's statistics office reported that Britain's trade deficit widened to 4.9 billion pounds in July from 3.9 billion in June as exports dipped and imports surged, fueling concerns about third quarter economic growth.
The figures came ahead of the Bank of England's monthly interest rate decision. No policy changes were announced _ as expected.
Elsewhere in Asia, Hong Kong's Hang Seng index added 0.4 percent to 21,167.27 but the benchmark Shanghai Composite Index lost 1.4 percent to 2,656.35.
Real estate companies were among the major fallers in China, with Poly Real Estate dropping 4.1 percent, while China Vanke lost 3.4 percent.
China is due to release trade and other economic indicators on Friday, with an update on inflation scheduled for Monday, adding to worries that signs of a rebound in property dealings might prompt fresh measures to discourage speculative buying.
"Investors are jittery over possible future policy adjustments both for industries and for the currency," said Liu Kan, an analyst at Guoyuan Securities in Shanghai.
And Australia's S&P/ASX 200 climbed 1 percent to 4,582.20 a day after the country's Labour Party secured support from independent lawmakers to form a new government.
South Korea's Kospi gained 0.3 percent to 1,784.36 after the Bank of Korea left its key interest rate near a record low for a second straight month, citing risks to the global growth outlook.
Oil prices rose above $75 a barrel after a report showed U.S. crude inventories fell more than expected, suggesting demand may be improving. Benchmark oil for October delivery was up 99 cents at $75.66 a barrel in electronic trading on the New York Mercantile Exchange. The contract rose 58 cents to settle at $74.67 on Wednesday.
___
AP Business Writer Elaine Kurtenbach in Shanghai contributed to this report.


Updated : 2021-05-19 05:45 GMT+08:00