News

European stocks gain as Wall St. set for rebound while Asia falls on earnings, volatile China

SEOUL, South Korea – European stock markets got off to a solid start Wednesday as U.S. futures pointed to a rebound on Wall Street. Asian markets closed lower, dented by weak earnings in Australia, a jump in oil prices and volatility in Chinese stocks.

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KEEPING SCORE: Britain’s FTSE 100 added 0.3 per cent to 6,949.23 and Germany’s DAX rose 0.8 per cent to 11,415.48. France’s CAC 40 gained 0.5 per cent to 4,999.04. Futures showed that Wall Street was set to recoup part of the previous day’s losses. S&P500 futures and Dow futures both climbed 0.3 per cent.

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ASIA’S DAY: South Korea’s Kospi fell 1.3 per cent to 2,104.58 and Australia’s S&P/ASX 200 sank 2.3 per cent to 5,692.20. Stocks in Southeast Asia were also lower. Chinese markets, which briefly rebounded from their biggest drop in months on Tuesday, failed to sustain the gains. Hong Kong’s Hang Seng index dropped 0.4 per cent to 27,640.91 and China’s Shanghai Composite Index lost 1.6 per cent to 4,229.27. Japan was closed for a holiday.

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THE QUOTE: “It’s hard to get consistency in markets at the moment and equities have been very choppy in recent weeks,” Stan Shamu, a market strategist at IG, said in a commentary. “A consistent theme has been the sell-off in bond markets as equities now seem to be responding to this as well.”

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AUSSIE BANK: Bank stocks pulled down the broader index in Australia. Commonwealth Bank of Australia, the country’s largest lender, plunged nearly 6 per cent after reporting disappointing quarterly results.

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US EVENTS: U.S. payroll processor ADP is scheduled to report later Wednesday on how many jobs private employers added in April. In March, U.S. businesses slowed their pace of hiring. Analysts said they are expecting to see an improvement in last month’s data. Federal Reserve Chair Janet Yellen speaks on “finance and society” at the International Monetary Fund. While markets are not expecting a big surprise in her speech, analysts will pay close attention to her language to find any signal about the timing of the Fed’s first rate hike this year.

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GREECE: A standoff in talks between Greece and its lenders stoked worries in the markets. Top officials in the European Union said they are making progress on finding a way to keep the country afloat and in the 19-nation eurozone. Greece will have to scrounge for cash to make a 750 million euro repayment to the International Monetary Fund by May 12.

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ENERGY: Benchmark U.S. crude jumped $1.47 to $61.87 per barrel in electronic trading on the New York Mercantile Exchange. Crude oil climbed above $60 a barrel for the first time this year on Tuesday following reports that a Libyan oil terminal had closed. The contract jumped $1.47 to finish at $60.40 a barrel on Tuesday. Brent crude added $1.50 to $69.02 a barrel in London.

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CURRENCIES: The dollar weakened to 119.81 yen from 119.93 yen. The euro strengthened to $1.1227 from $1.1184.