Contrasting Germany, China data lifts stocks

Filed on September 9, 2015 | Last updated on September 9, 2015 at 07.36 am
Contrasting Germany, China data lifts stocks
An electronic stock indicator of a securities firm in Tokyo.


German data offers relief; Asia snaps six-day losing streak

Shares rose in Europe and Asia on Tuesday after trade data from China and Germany highlighted the divergent outlooks of the two heavyweight economies.

China said its imports fell far more than expected last month, adding to concerns about the world's second-biggest economy's contribution to global growth.

However, Chinese stocks, which have fallen some 40 per cent since mid-June, rose as some analysts calculated the data, which showed exports on the other hand fell less than expected, could lead to further policy easing in the coming months.

By contrast, Germany saw imports and exports hit record highs in value terms in July, underlining strong foreign demand for goods from Europe's largest economy.

"The German data is offering some relief that the European recovery remains on track and German exports are not impacted too much by the emerging market turmoil," Philippe Gijsels, head of research at BNP Paribas Fortis Global Markets, said.

Worries over the Chinese growth outlook have led some analysts to question whether a widely-expected rise in US interest rates might be delayed, though some policymakers have suggested they would look beyond the recent market turmoil.

The pan-European FTSEurofirst 300 index rose 2.1 per cent, gathering strength as the day progressed, with Germany's DAX index advancing by a similar amount.

Britain's FTSE 100 index was up 1.7 per cent.

Wall Street, which was closed on Monday for a holiday, was expected to open up to two per cent higher, according to stock index futures.

Oil rises

Earlier, Asian shares broke a six-day losing streak. MSCI's broadest index of Asia-Pacific shares outside Japan was up two per cent.

China's Shanghai Composite index closed 2.9 per cent higher, albeit in the lowest volume since late February after the government unveiled on Monday a series of measures intended to curb speculation. The CSI 300 index rose 2.6 per cent.

Japanese stocks fell, partly reflecting the data from China, one of its main trading partners. The Nikkei 225 index closed down 2.4 per cent, taking it into negative territory for the year.

The dollar strengthened against the safe-haven Japanese yen, last trading up 0.7 per cent at 120.09 and the euro held steady at $1.1160.

The dollar index, which measures the greenback against a basket of currencies, fell 0.1 per cent.

Yields on 10-year German government bonds, the eurozone benchmark, were flat at 0.68 per cent.

Copper prices rose two per cent to $5,256 a tonne as the Chinese data showed imports of the metal held steady.

Gold held steady at around $1,119 an ounce after a four-day losing streak as the dollar eased.

Sensex rises

Meanwhile, a strengthening rupee, efforts to restart reforms and expectation of more rain, coupled with positive Asian market cues, propelled the barometer index of Indian equities to provisionally close 451 points up on Tuesday.

The 30-scrip sensitive index of the Bombay Stock Exchange rose 451.28 points or 1.81 per cent.

The wider 50-scrip Nifty of the National Stock Exchange too made gains during the day's trade. It was higher by 129.45 points or 1.71 per cent at 7,688.25 points.

The S&P BSE Sensex, which opened at 24,972.01 points, provisionally closed at 25,345.09 points (at 3:30pm) - up 451.28 points or 1.81 per cent from the previous day's close at 24,893.81 points.

The Sensex touched a high of 25,411 points and a low of 24,833.54 points in intraday trade. - Agencies

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