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Asian Markets at Close Report

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May 16, 2017

Asia, Europe and U.S . Stock Markets Closings' Summary Reports on May 16, 2017

ASIA

marketwatch.com

Lucy Craymer



Stock markets across Asia closed broadly lower on Friday, tracking overnight weakness in Europe and the U.S. amid disappointing earnings reports.
Japan was falling as stocks were hit by a 0.3% gain in the yen USDJPY, -0.66%  against the U.S. dollar, making the country’s exports less competitive. The Nikkei Stock Average NIK, +0.25%   dropped 0.4%.
Among key Japanese export stocks, Toyota Motor 7203, +1.40%   fell 1.2% and Honda Motor 7267, -0.85%   lost 1.6%, while Sony 6758, +0.45%   gave up 0.7%.
Elsewhere, Korea’s Kospi SEU, +0.20%  ended 0.5% lower, while Australia’s S&P/ASX 200 XJO, +0.21%  declined 0.7%. Hong Kong’s Hang Seng Index HSI, -0.14%  ended up 0.1%. In China, the Shanghai Composite Index SHCOMP, +0.74%  rose 0.7%, led by gains in insurance, aviation and automotive shares. Investors are watching whether the index holds above the key 3,000-point level.
“At the margins it’s similar to what we saw in the U.S., there is a slightly risk-off feel to this market,” said Chris Weston, chief market strategist at IG Markets in Australia.
Weston said sentiment was favoring less discretionary stocks in the market, although commodities in Australia continue to find some support. Among those, Rio Tinto RIO, +1.41%   climbed 0.4% and BHP Billiton BHP, +0.84%  gained 0.6%, supported by a rise in copper prices.
Overnight, U.S. stock indexes pulled back slightly, with the Dow Jones Industrial Average ending down 0.1%, as individual stocks sold off following disappointing corporate earnings reports. Shares of department store leader Macy’s M, -1.68%   shed 17% after the firm reported a bigger-than-expected slide in first-quarter revenue.
Analysts, however, still see some potential for gains in Asia, which has seen India and South Korea log fresh record highs and Japan, Hong Kong, Indonesia and Taiwan post multiyear bests.
“We keep on making new records, and as long as we continue to have hot money I don’t think it’s going to be cut off any time soon,” said Stuart Ive, private client manager at OM Financial in Wellington, New Zealand.
“We might have some corrections to the downside, but any pullbacks we’ve seen so far have been very, very shallow,” Ive noted.
In the forex market, the New Zealand dollar NZDUSD, +0.0727%  was one of the biggest movers after the country’s central bank surprised the markets by retaining a neutral bias, which pushed the currency down 1.5% against the U.S. dollar over the past day.

EUROPE



Carla Mozee, Victor Reklaitis


European stocks finished slightly lower Tuesday, with declines in automobile shares and a rise in the euro drawing Germany’s benchmark down from its previous record.
The Stoxx Europe 600 index SXXP, -0.02% was down less than 0.1% to end at 395.91. The index on Monday ended up 0.1%, a second straight advance that kept the index around its highest level since August 2015.
The pan-European index’s recent gains have seen contributions from German and British blue chips, with the Germany’s DAX 30 DAX, -0.02%  logging a record close Monday, and the U.K.’s FTSE 100 UKX, +0.91%  scoring one Tuesday.
“Markets seem to be enjoying the signs that incumbent governments are set for victory in upcoming elections,” said Jasper Lawler, senior market analyst at London Capital Group, in a note.
German regional elections over the weekend appeared to bolster optimism for German Chancellor Angela Merkel’s prospects for September’s federal election. Meanwhile, U.K. Prime Minister “Theresa May is going for the jugular and markets like it,” he said. “Investor cheer at a Conservative victory has gotten even louder since Labour’s apparent plans for a ‘Robin Hood tax’ on financial transactions.”
The FTSE 100 index rose 0.9% to end at 7,522.03, marking a record and the first time it has closed above 7,500. The British benchmark was aided by downbeat action by the pound GBPUSD, +0.1861% despite British inflation hitting its strongest level in more than three years.
Read more: The pound faces these hurdles as it battles to reclaim $1.30
The DAX 30 on Tuesday tilted down less than 0.1% to end at 12,804.53, which still marked its second-best finish in history.
The export-oriented German equity market eased as the euro EURUSD, +1.0297%  traded above $1.10 for the first time since May 5, buying $1.1068. That’s up from $1.0975 late Monday in New York.
Read: Dollar slides to 6-month low as worries about Trump return
In Paris, the CAC 40 PX1, -0.21% fell 0.2% to finish at 5,406.10.
Movers: Auto shares struggled after European car registrations fell 6.6% in April, according to data from the European Automobile Manufacturers’ Association out on Tuesday. On the DAX, shares of Daimler AG DAI, -0.63%  lost 0.5%, BMW AG BMW, -0.89%  declined 0.8% and Volkswagen AG VOW3, -0.41%  was 0.7% lower. Car tires manufacturer Continental AG CON, -0.92%  pulled back 1%.
BTG PLC BTG, -6.79%  dropped 6.8% after the drugmaker posted a decline in yearly pretax profit to 31.6 million pounds ($40.8 million), but noted a steady increase in demand for its Varithena varicose vein treatment.
Topping the FTSE 100, Vodafone Group PLC shares VOD, +3.96% VOD, +4.02%  climbed 4% after the telecom forecast profit growth in the current year after hitting its organic growth target for fiscal 2017. Vodafone also raised its final dividend by 2% but posted an annual loss of 6.1 billion euros ($6.73 billion).
EasyJet PLC shares EZJ, -7.25%  dropped 7.3% after the budget carrier’s six-month net loss widened to 192 million pounds ($248 million). The airlines said weakness in sterling against the dollar and euro shaved £82 million off the bottom line.
Read: The ECB has 3 big reasons to wind up QE—here’s why it shouldn’t
Economic news: Eurozone economic growth expanded by 0.5% in the first quarter, according to the second estimate of gross domestic product from Eurostat. That was in line with forecasts and the flash estimate.
u.s.

Mark DeCambre

The S&P 500 index on Tuesday marked its 15th session with a move within 0.5%, representing the longest such streak in about 48 years, according to Dow Jones data. The longest consecutive period of closes within 0.5% for the S&P 500 SPX, -0.07% is a 20-session streak in February 1969. The S&P 500 finished Tuesday's trade less than 0.1% lower at 2,400, while the Dow Jones Industrial Average DJIA, -0.01% saw comparably muted action on the day, closing near break-even levels at 20,979. Meanwhile, the Nasdaq Composite Index COMP, +0.33% which has outperformed its peer equity benchmarks year to date, ended at a record, up 0.3% at 6,169, wrapping near its highs of the session. Tuesday's trading come amid heightened doubts that President Donald Trump can easily push through Congress the type of market-friendly policies that have helped so-called risk assets log a series of all-time highs. Wall Street spent much of Tuesday digesting reports that the president shared classified intelligence with Russian officials during a meeting in the White House last week, coming just a day after he fired then-Federal Bureau of Investigation Director James Comey. Brisk moves for stock gauges over the past few months, on postelection euphoria, have mostly stalled out over the past several weeks as investors weigh a mixed batch of economic reports, the likelihood of Trump's policies coming to fruition and corporate earnings that have come out better than expected.