Asian shares fall back after China reports economy weakened

19-Oct-2019 Intellasia | AP | 6:02 AM Print This Post

Share prices retreated in Asia after China reported Friday that its economy grew at an annual rate of 6.0 percent in the latest quarter.

The Shanghai Composite index gave up early gains, losing 0.6 percent to 2,960.55 while Hong Kong’s Hang Seng shed 0.2 percent to 26,800.24. Australia’s S&P ASX 200 declined 0.6 percent to 6,643.00 and the Kospi in South Korea slipped 0.1 percent to 2,075.33.

Japan’s Nikkei 225 index advanced 0.2 percent to 22,492.34 and shares also rose in Jakarta but fell in the rest of Southeast Asia and in Taiwan.

The 6.0 percent growth pace for July-September was worse than forecast and the slowest since China began reporting quarterly 26 years ago.

It adds to pressures on global growth and ups pressure on Chinese leaders to avert politically dangerous job losses as they fight a tariff war with President Donald Trump over Beijing’s trade surplus and technology ambitions.

While some of the data for September were stronger, “pressure on economic activity should intensify in the coming months,” Julian Evans-Pritchard of Capital Economics said in a commentary.

“Cooling global demand will continue to weigh on exports, fiscal constraints mean that infrastructure spending will wane in the near-term and the recent boom in property construction looks set to unwind.”

Overnight, stocks closed broadly higher on Wall Street Thursday as investors welcomed another batch of encouraging quarterly results from big companies.

A breakthrough in negotiations over Britain’s exit from the European Union also helped put traders in a buying mood.

The gains erased the market’s modest losses from the day before. Despite a choppy week of trading, the benchmark S&P 500 index is on track for its second straight weekly gain.

Several companies have turned in surprisingly good third-quarter results and outlooks. That’s helped to ease some investors’ concerns over the economy, though red flags remain over the trade war.

“About 76 percent of those that have reported have beat on earnings,” said Adam Taback, deputy chief investment officer at Wells Fargo Private Bank.

The forecasts from companies haven’t been as negative as many expected, Taback said, but many have raised concerns about “slowing global growth and risk of trade wars.”

The S&P 500 index gained 0.3 percent to 2,997.95. The index is within 0.1 percent of its all-time high set in July.

The Dow Jones Industrial Average briefly slipped into the red, but managed to add 0.1 percent to 27,025.88. The Nasdaq rose 0.4 percent to 8,156.85.

Traders favoured smaller-company stocks. The Russell 2000 index climbed 1.1 percent, to 1,541.84.

Bond prices fell. The yield on the 10-year Treasury note rose to 1.75 percent from 1.74 percent late Wednesday.

The market climbed in the early going as investors reviewed earnings reports from several companies, including Netflix, CSX and Morgan Stanley.

US stocks also got a boost from news that Britain had reached a tentative deal to separate from the European Union. The deal still faces a potentially tough fight for approval in Britain’s divisive Parliament.

In other trading, benchmark crude oil lost 12 cents to $53.81 per barrel in electronic trading on the New York Mercantile Exchange. It rose 57 cents to settle at $53.93 a barrel on Thursday.

Brent crude oil, the international standard, lost 33 cents to $59.58 a barrel.

The dollar fell to 108.56 Japanese yen from 108.66 yen on Thursday. The euro strengthened to $1.1127 from $1.1126.

https://sg.news.yahoo.com/solid-earnings-britain-europe-deal-142810684.html

 


Category: FinanceAsia

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