JW: Asian stocks sink on US turbulence, weak China growth
Wall Street had seen its early gains on Tuesday erased by the tumble in USA crude. The price of crude oil continued to fall, and energy and mining stocks tumbled.
Global stocks sagged Wednesday after the IMF’s lower growth forecast added to anxiety over a weaker Chinese economy.
Its gain of about 2 percent against the dollar makes it the best performing major currency of early 2016, reflecting net buying by currency speculators this month for the first time since Prime Minister Shinzo Abe took office in late 2012. By noon, the Dow Jones industrial average was up 103 points, or 0.65 percent.
Back in Blighty, full-year results from consumer goods leviathan Unilever (LON:ULVR) are scheduled, as is a trading statement from oil & gas firm Cairn Energy (LON:CNE).
“There is also the fact that there is still plenty of scope for fiscal and monetary stimulus to plug any gaps that appear in the coming years during this period of transition, which occurs at a time when the country is also trying to liberalise its markets, something that has faced many challenges already and will likely continue to do so this year”. Panasonic and Sharp are lower by more than 2 percent each. Brent crude, a benchmark for global oils, rose 62 cents, or 2.2 per cent, to $29.17 a barrel in London.
In Asia, stocks surrendered all of Tuesday’s rare gains with MSCI’s broadest index of Asia-Pacific shares outside Japan falling 3 per cent on the day and hitting its lowest since October 2011. The contract rose 21 cents on Monday to close at $28.76.
The price of gold fell $1.60 to $1,089.10 an ounce.
P&G rose 1.1 and McDonald’s was up 1.6 per cent after brokerages upgraded both stocks. Meanwhile, the Nasdaq Composite was down 11.47 points, or 0.3%, at 4,476.95. Chesapeake Energy lost 27 cents, or 7.6 per cent, to $3.29. Freeport-McMoRan shares have skidded 41.5 percent in 2016.
Delta Air Lines rose 3.3 per cent after reporting fourth-quarter earnings of US$980 million (S$1.4 billion), compared with a loss of US$712 million in the year-ago period. Excluding energy companies, earnings are seen growing 1.5 per cent.
UnitedHealth was up 2.4 percent at $111.91, giving the biggest boost to the Dow, after the health insurer reported a 30 percent rise in quarterly revenue.
Market heavyweight Fast Retailing is losing more than 2 percent and SoftBank is down more than 3 percent.
After the bell, Netflix surged 8 per cent after the streaming service’s fourth-quarter subscriber additions topped expectations thanks to strong worldwide growth.
Tiffany was down 4.1 percent at $64.89 after the upscale jeweler said holiday season sales fell 6 percent. Tokyo lost 2.2 percent by the break, Hong Kong was 3.28 percent down and Sydney shed 0.6 percent.
“The market was pricing in much worse”, said Nader Naeimi, Sydney-based head of dynamic markets at AMP Capital Investors. Its shares rose $1.25, or 2.8 percent, to $45.75.
Quarter on quarter growth slipped to 1.6% in the last three months of 2015 from 1.8% in the third quarter.
CURRENCIES: The U.S. dollar edged up to 118.00 yen from 117.50 yen on Monday. The euro rose to $1.0899 from $1.0885. The Nasdaq futures are trading up around 73 points.
