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Showing posts with label Asian Markets at Close Report and U.S. Future Markets Indications | MarketWatch .. Show all posts
Showing posts with label Asian Markets at Close Report and U.S. Future Markets Indications | MarketWatch .. Show all posts

Dec 9, 2014

Asian Markets at Close Report and U.S. Future Markets Indications | MarketWatch

Shares fall in Shanghai as investors cash in on volatility



Shanghai shares sold off sharply and Australian markets fell Tuesday, amid a renewed slide in oil prices and profit-taking in China, where domestic investors cashed in during an especially volatile day of trading.
The Shanghai Composite Index SHCOMP, -5.43%  tumbled 5.4% to 2856.27, having swung from a 2.4% rise earlier but off from a decline of 6.1% in the last few minutes of trading. The loss was the biggest daily percentage drop in more than five years.
Analysts attributed the decline to profit-taking after a rise of 23% in the previous 13 sessions. A more-than-250-point swing was “shocking but not that shocking at the same time,” said Yang Xia, head of China equities at UBS Securities.
“We all knew there was going to be such a day” with international investors taking profit over recent sessions, but domestic investors likely driving the market lower Tuesday, he said. “A few days of adjustment would set the market at a more healthy tone,” he added.
Some of the weakness also appeared to stem from a new rule by China’s securities clearing house late Monday that tightened the use of corporate bonds as collateral for short-term financing. The rule is an attempt to rein in risky debt issuances from struggling companies and local governments.
Yields were up sharply in China’s bond market on the news, with the benchmark seven-year government bond AMBMKRM-07Y, -2.85%  yield rising to 4.00% in the morning, from 3.78% Monday. Yields were last at 3.85%.
In Australia, energy and mining stocks led the S&P ASX 200 XJO, -1.68%  lower by 1.7% to 5,282.70. The energy subindex lost 4.8%, while the mining sector shed 3.1%.
Investors in Australia were also selling after a monthly survey by National Australia Bank showed Australian consumer and business confidence levels falling sharply in November. The data reflected growing uncertainty about the economic outlook, and the survey raises the likelihood of an interest-rate cut early next year.
The Australian dollar AUDUSD, +0.04%  also was under pressure, falling to a fresh four-and-a-half-year low against the U.S. dollar. It traded as low as $0.82 intraday in Asia.
Oil producer Santos Ltd. STO, -7.23%  tumbled 7.2%, following a downgrade by Standard & Poor’s from BBB from BBB+. The company in response said its financial position was unaffected by the rating change.
Elsewhere, the Nikkei Stock Average NIK, -0.68%  was down 0.7% to 17813.38, and Korea’s Kospi SEU, -0.40%  lost 0.4% at 1970.95.
Japan’s market continues to face headwinds after revised data Monday showed the economy contracted more than the government estimated in the third quarter, which confirmed that the country was in a recession.


MADRID (MarketWatch) — U.S. stock futures pointed to a rough start for Wall Street on Tuesday, amid fresh speculation the Federal Reserve may be close to pulling back its pledge to keep rates low, and as global markets tumbled on weak oil prices.
Futures for the Dow industrials DJZ4, -0.33%  fell 44 points, or 0.3%, to 17,807, while those for the S&P 500 index SPZ4, -0.33%  dipped 4.9 points, or 0.2%, to 2,054.60. Futures for the Nasdaq-100 index NDZ4, -0.35%  dropped 11.75 points, or 0.3%, to 4,267.25.
On Monday, the S&P 500 SPX, -0.73%  suffered its biggest one-day slide in seven weeks, dogged by a selloff in energy companies and downbeat global economic reports.
Hovering at five-years, oil prices CLF5, +0.87%  attracted some buyers early Tuesday, but action was volatile. Both Jefferies and Macquarie slashed their prices for the commodity, saying more pain is coming.
Fed rate-hike worries redux: The other focus for stocks was an article that published late Monday in The Wall Street Journal. Jon Hilsenrath, who covers the Fed for the newspaper said officials meeting next week will likely affirm a plan to start raising short-term interest rates in 2015 and are debating losing the phrase that rates will stay low for “a considerable time.”
This report comes on the heels of Friday’s jobs report showed that even wages are picking up again and the economy is returning to some sort of normalcy.
“But regardless of the motivation behind the decision to remove the language from its statement, the markets clearly do not like the prospect of higher rates in the U.S., even though we’re seeing large stimulus programs being adopted by a number of major central banks elsewhere,” said Craig Erlam, market analyst at Alpari U.K., in a note.
Data for Tuesday includes the National Federation of Independent Business’s November report at 7:30 a.m. Eastern Time. At 10 a.m. Eastern, job openings and wholesale inventories for October will be released.
Stocks to watch: AutoZone Inc. AZO, -1.17%  will report earnings early Tuesday. Burlington Stores Inc. BURL, -1.77%  and Krispy Kreme Doughnuts Inc. KKD, -2.62% are also on the docket.
H&R Block Inc. HRB, -0.99%  late Monday reported its fiscal second-quarter loss widened to $112 million, or 41 cents a share, from $104.9 million, or 39 cents a share, a year ago.
Analysts at Jefferies downgraded Schlumberger Ltd. SLB, -3.38% Oceaneering International Inc. OII, -5.10% and Nabors Industries Ltd. NBR, -7.33%  to hold from buy, as they lowered estimates and price targets across the oil services and equipment sector to account for lower oil prices. Jefferies cut its Brent price to $72.25 a barrel from $90 a barrel for 2015.
Global markets under pressure: The Stoxx Europe 600 index SXXP, -0.96%  fell more than 1%, weighed by a drop in German trade data and losses for energy companies. The FTSE 100 index UKX, -1.01%  was equally weak, with fears thatChina will cut its growth forecast hitting commodity-related stocks.
Shares slid across Asia. In a wild day of trading, the Shanghai Composite IndexSHCOMP, -5.43%  swung from a a 2.4% rise to a closing loss of 5.4%. China’s stocks, currency CNYUSD, -0.26%  and corporate bonds were hit hard after Beijing banned investors from using low-grade corporate debt as collateral to borrow cash.
Gold prices GCG5, +1.03%  surged as investors backed off stocks, and the yenUSDJPY, -0.64%  regained some safe-haven bids as well inching up against the dollar.

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