Chinese stocks surged on the final day of 2014, leading gains in other world markets as investors readied...
Chinese stocks surged on the final day of 2014, leading gains in other world markets as investors readied for a year likely to be defined by fragility in major economies.
Keeping Score: China’s Shanghai Composite jumped 2.2 percent to 3,234.68 on Wednesday after a weak manufacturing report reinforced hopes for new stimulus as growth in the world’s No. 2 economy slows. The index’s gain of about 54 percent for the year makes it the best performing market among major economies. In early European trading, France’s CAC 40 was up 0.3 percent at 4,260.17 and Britain’s FTSE 100 added 0.4 percent to 6,570.32. Futures augured gains on Wall Street. Dow futures rose 0.1 percent to 17,967 and S&P 500 futures gained 0.2 percent to 2,080.40. Most markets will be closed Thursday.
China Manufacturing: A survey of Chinese manufacturers found their activity contracted in December in a new sign the world’s second-largest economy is slowing despite government efforts to shore up growth. HSBC Corp. said its monthly purchasing managers’ index fell to 49.6 on a 100-point scale on which numbers below 50 show activity contracting; markets were expecting that outcome since a preliminary version of the survey released earlier in the month also showed a contraction but the confirmation underpinned hopes for more government stimulus in China.
Greece Jitters: The Greek government was earlier this week forced to call elections that could create more economic turmoil. Investors worry that the elections might be won by the left-wing opposition Syriza party, which opposes the austerity measures associated with Greece’s international financial rescue deal. The Athens stock market plunged as much as 11 percent on Monday before recovering some of those losses to close down 4 percent that day.
The quote: ”Heading into 2015, many of the challenges the market has faced this year will be recurring,” said Stan Shamu, market strategist at IG in Melbourne, Australia. Analysts say investors will be preoccupied by the slowdown in China, the economic malaise in Europe and Japan, and the possible timing of the U.S. Federal Reserve’s first interest rate hike since the financial crisis. ”The beginning part of the year will be dominated by Europe and then we’ll switch to the U.S. toward the middle of the year,” said Shamu.
Asia scorecard: Hong Kong’s Hang Seng added 0.4 percent to 23,605.04. India’s Sensex rose 0.2 percent to 27,453.99 while Australia’s S&P/ASX 200 dropped 0.1 percent to 5,411. Taiwan’s benchmark gained 0.4 percent to 9,307.26. Markets were closed in Japan, South Korea and most of Southeast Asia. Almost all Asian stock markets are closed on New Year’s Day.
Oil prices: Benchmark U.S. crude was down 51 cents at $53.61 a barrel in electronic trading on the New York Mercantile Exchange, and is down about 46 percent for the year as demand weakened while supplies stayed high. The contract rose 51 cents on Tuesday. There is no Nymex trading on New Year’s Day. Brent crude, a benchmark for international oils, was down 88 cents at $57.02 a barrel on the ICE exchange in London.
Currencies: The euro dropped to $1.2155 from $1.2162 late Tuesday. The dollar rose to 119.63 yen from 119.47 yen.