Asian stocks rise after disappointing US manufacturing data

05-Sep-2019 Intellasia | AP | 6:02 AM Print This Post

Asian stock markets rose Wednesday following surprise weakness in US manufacturing and wrangling in Britain over the country’s departure from the European Union.

Benchmarks in Shanghai, Tokyo and Hong Kong advanced.

The Institute for Supply Management, an association of purchasing managers, said its manufacturing index slid to a 31/2-year low of 49.1 last month from July’s 51.2.

A global softening in demand, aggravated by the US-Chinese tariff war, appears to be hurting American manufacturers. More than half of the public comments from companies surveyed by ISM pointed to economic uncertainty as a drag on their businesses.

“This is perhaps one of the stronger signs that the US is likewise feeling the weight from the on-going uncertainties alongside the world,” said Jingyi Pan of IG in a report.

In London, prime minister Boris Johnson suffered a setback when Parliament agreed to allow his opponents to introduce legislation that would block Britain from leaving the EU without an agreement on terms of their future trade and other relations. Britain is due to withdraw October 31, a deadline the trade bloc’s other members would have to agree to postpone.

Johnson’s plan to call a new election to reinforce his position “could again induce more volatility,” said Mizuho Bank in a report.

The Shanghai Composite Index rose 0.6 percent to 2,947.49 and Tokyo’s Nikkei 225 was 6 points higher at 20,631.14. Hong Kong’s Hang Seng advanced 1.6 percent to 25,948.21.

South Korea’s Kospi gained 0.2 percent to 1,970.03 while Sydney’s S&P-ASX 200 lost 0.5 percent to 6,539.70.

Markets in Taiwan, New Zealand and Singapore also advanced.

On Tuesday, technology companies drove a slide in US stocks as markets reopened following a holiday weekend and the latest round of tariff hikes by Beijing and Washington on each other’s imports.

The benchmark S&P 500 index dropped 0.7 percent to 2,906.27. The Dow Jones Industrial Average lost 1.1 percent to 26,118.02. The Nasdaq composite fell 1.1 percent to 7,874.16.

AUSTRALIAN ECONOMY: Australia’s economic growth fell to a decade low, but the government tried to reassure the public the country wasn’t headed for its first recession in 29 years. Data released Wednesday showed economy expanded by 1.4 percent in the year that ended in June and 0.5 percent in the latest quarter. Treasurer Josh Frydenberg told reporters economic fundamentals still are strong and the latest data fail to reflect the impact of cuts in taxes and interest rates.

ENERGY: Benchmark US crude gained 26 cents to $54.20 per barrel in electronic trading on the New York Mercantile Exchange. The contract fell $1.16 on Tuesday to close at $53.94. Brent crude, used to price international oils, gained 22 cents to $58.48 per barrel in London. It lost 40 cents the previous session to $58.26.

CURRENCY: The dollar was little-changed at 105.97 yen. The euro held steady at $10.976.


Category: FinanceAsia

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