Singapore, Oct 22 (AP/UNB) — World markets rose on Monday, brushing off lagging Chinese growth and a downgrade in Italy's credit rating after its lawmakers approved a budget plan with room for a higher deficit.
KEEPING SCORE: Germany's DAX added 0.5 percent to 11,612.90 and France's CAC-40 was 0.2 percent higher at 5,096.74. Britain's FTSE 100 gained 0.4 percent to 7,078.68. On Wall Street, the future contract for the Dow Jones Industrial Average was up 0.2 percent at 25,485.00. Standard & Poor's 500 futures edged 0.2 percent higher to 2,772.00.
ASIA'S DAY: The Shanghai Composite index jumped 4.1 percent to 2,654.88 and the Hang Seng in Hong Kong surged 2.3 percent to 26,153.15. Japan's Nikkei 225 index reversed early losses, gaining 0.4 percent to 22,614.82 and the Kospi in South Korea added 0.3 percent to 2,161.71. Australia's S&P-ASX 200 countered the trend, shedding 0.6 percent to 5,904.90. Shares rose in Taiwan, Singapore and Indonesia but fell in Thailand.
CHINESE RALLY: Investors appeared to take heart from reassurances from Chinese officials over slowing economic growth. Gains might also have been driven by the expectation that weak GDP data could spur further stimulus. Song Seng Wun, an economist at CIMB Private Banking, noticed that state-linked funds were also buying into weakening markets. "Some investors are bargain hunting on the basis that there will be limited downsides," he added.
ITALY BUDGET: Italian lawmakers passed a draft budget that could raise the country's deficit to as much as 2.4 percent of gross domestic product. That's three times higher than promised by the previous government. In response, international credit rating agency Moody's downgraded Italy's ratings to Baa3, while keeping its outlook stable. The agency said there was a "material weakening in Italy's fiscal strength." The European Union has expressed concerned that the Italy's plans would worsen its debt. But a sharp narrowing in Italian bond yields, especially long-term ones, is lifting stock markets. Italy's benchmark FTSE MIB added 0.6 percent to 19,186.91.
ANALYST'S TAKE: "The world appears to have bought time on the worst of headline and geopolitical risks, and that appears to be quelling the worst fears and helping to backstop markets," Vishnu Varathan of Mizuho Bank said in a commentary.
ENERGY: Benchmark U.S. crude rose 20 cents to $69.32 per barrel in electronic trading on the New York Mercantile Exchange. The contract added 0.7 percent to $69.12 a barrel in New York. Brent crude, used to price international oils, picked up 21 cents to $79.99 per barrel. In the previous session, it gained 0.6 percent to $79.78 a barrel.
CURRENCY: The dollar strengthened to 112.84 yen from 112.56 yen on Friday. The euro fell to $1.1505 from $1.1516.
World stocks push past growth worries in China, Italy
- UNB News
- Publish Date - October 22, 2018, 06:57 PM
- 609 Views
- Update Date - October 22, 2018, 07:57 PM