Global stocks rise, China falls after Xi’s tough talks

TOKYO (AP) – Global stocks were mostly higher on Friday, although the markets in Shanghai and Hong Kong fell a day after the Chinese Communist Party celebrated its centenary with harsh words from President Xi Jinping.

The French CAC 40 lost nearly 0.1% to 6,548.52. The German DAX gained 0.2% to 15,629.70. The UK FTSE 100 edged up 0.1% to 7,134.65. The future of Dow industrials was virtually unchanged at 34,511.0, and the S&P 500 future edged up less than 0.1%.

Japan’s benchmark Nikkei 225 added 0.3% to close at 28,783.28. South Korea’s Kospi was little changed, falling less than 0.1% to 3,281.78. The Australian S & P / ASX 200 gained 0.6% to 7,308.60. But the Hong Kong Hang Seng fell 1.8% to 28,310.42, while the Shanghai Composite was also down nearly 2% to 3,518.76.

In his speech, Xi warned that anyone who tries to intimidate China “will face broken heads and bloodshed.”

He appeared to strike back at the United States and others who criticized China’s trade and technology policies, military expansion, and the human rights record. The harsh rhetoric also emerged aimed at a national audience. But coming at a time of heightened tension with Washington, it set an ominous tone.

Concerns over the spread of the Delta variant of the coronavirus and the ability of vaccinations to contain it are also weighing on Asian markets.

Fitch Solutions predicts in a report that the Japanese economy will begin to recover as more people are vaccinated against COVID-19. The pace of vaccine deployment in Japan is about the same as in the rest of Asia, with around 10% of the population fully vaccinated. It is delaying the United States and much of Europe.

“We note that the economic impact of the Covid-19 pandemic has created a significantly weak base from which to develop,” Fitch said.

“The recovery in retail sales and consumer confidence will depend on the ability of the government to immunize enough people to allow for a gradual easing of restrictions.”

Investors have been encouraged by data which shows the economy is continuing to recover from the pandemic. The latest weekly report on unemployment in the United States showed the lowest number of applications for unemployment assistance since the pandemic devastated the economy. The highly anticipated US employment report for June comes out later today.

Employment has been one of the weakest areas of the economic recovery, lagging behind other measures such as consumer confidence and retail sales. Economists and analysts have said that a much fuller and more stable recovery depends on more people getting back to work.

Economists polled by FactSet expect the US economy to create 675,000 jobs last month and the unemployment rate to fall to 5.7%.

The June jobs report is also being watched closely as a potential indicator of when the Federal Reserve may begin to ease its bond purchases and other measures that have kept interest rates low. Inflation fears have subsided somewhat, but investors are still trying to determine whether the rise in inflation will be temporary or more lasting.

Investors will want to know if wages have continued to increase, which could increase inflation.

Benchmark US crude rose 5 cents to $ 75.28 a barrel. Brent crude, the international standard, rose 2 cents to $ 75.86 a barrel.

In currency trading, the US dollar fell to 111.43 Japanese yen from 111.51 yen on Thursday night. The euro cost $ 1.1829, compared to $ 1.1847.

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