Asia markets rise on Wall St rally; China slumps

Asian shares edged higher Monday on the back of a strong Wall Street rally, but Chinese stocks plunged to a new three-year low after growth in the world’s second-largest economy slowed.

By (AFP)

Published: Mon 16 Jul 2012, 3:59 PM

Last updated: Tue 7 Apr 2015, 12:54 PM

Hong Kong’s benchmark Hang Seng index closed up 0.15 percent, or 28.71 points, at 19,121.34, while Sydney finished 0.56 percent, or 22.9 points, higher at 4,105.1, with resource stocks leading the way.

But the Shanghai Composite Index slumped 1.74 percent, or 37.94 points, to 2,147.96, its lowest level since March 2009.

Tokyo was closed for a public holiday.

Official data released Friday showed the Chinese economy expanded 7.6 percent in the second quarter year-on-year, its slowest pace for more than three years as it was hit by ripples from the eurozone debt crisis and slow US recovery.

Chinese Premier Wen Jiabao warned Sunday that while there was “a lot of dynamism and momentum for economic growth”, China’s “economic rebound is not yet stable and economic hardship may continue for a period of time”.

In the depths of the global financial crisis at the start of 2009 China’s economy grew at a rate of 6.6 percent.

Beijing’s full-year growth target is 7.5 percent.

But elsewhere, stocks were lifted after US markets broke a six-day losing streak on Friday following better-than-expected figures from banking giant JP Morgan Chase, which announced a $5 billion second-quarter profit even after accounting for $4.4 billion in trading losses.

The Dow closed up 1.62 percent, or 203.82 points, at 12,777.09, the S&P 500 rose 1.65 percent and the tech-rich Nasdaq 1.48 percent.

European shares opened weaker on Monday, with London’s FTSE 100 index down 0.18 percent, the DAX 30 in Frankfurt 0.09 percent lower, and Paris’ CAC 40 off 0.17 percent.

The US is China’s biggest trading partner and on currency markets the dollar advanced against the euro, with the single currency fetching $1.2222 in afternoon Asian trade compared to $1.2248 in New York on Friday.

Gold was worth $1,586.22 an ounce at 0825 GMT, compared with $1,583.22 on Friday.