Asian stocks rise but Europe still waiting for central bank
AP and AFPAMSTERDAM/ HONG KONG--Asian stocks rose Thursday though European markets erased early gains as investors awaited comments from European Central Bank President Mario Draghi later in the day.
September 7, 2013, 12:03 am TWN
The ECB is almost certain to keep rates at their current low levels after its Governing Council meets, but markets will be parsing Draghi's comments about the future, as Europe is beginning to show signs of recovery from its protracted slump.
Observers believe “Draghi will reiterate his dovish forward guidance at today's regular Council meeting,” said Rabobank currency analyst Jane Foley in a note. “Insofar as the eurozone still has a long way to go before shrugging off the mantle of slow growth and crisis, the ECB is likely to attempt to push back against the recent move higher” in interest rates on government bonds.
After rising early in the session, stocks faded ahead of the ECB meeting. At midday, Britain's FTSE 100 fell 0.1 percent to 6,471.53. Germany's DAX fell 0.2 percent to 8,180.80. France's CAC-40 was down fractionally at 3,978.22.
Meanwhile, most Asian stocks benefited from good news Wednesday in the US: a Federal Reserve survey that showed moderate economic growth in the summer months and the best sales data for car makers in six years.
Wall Street was expected to be steady on the open, with Dow Jones industrial futures down 20 points to 14,910. S&P 500 futures were also down marginally to 1,652.
Investors were also looking ahead to Friday, when the U.S. jobs report for August will be released. Economists expect that the U.S. created 177,000 jobs last month and that the unemployment rate held steady at 7.4 percent, according to financial data provider FactSet.
Friday's jobs report is the last major piece of economic data the Federal Reserve will have to work with before the central bank decides whether or not to pull back on its massive bond-buying program. That program has kept interest rates abnormally low. While most investors believe the Fed will begin to pull back, the question has become when and how much.
Asian markets mostly rose on Thursday, following an upbeat Federal Reserve report on the US economy and positive European growth data, but gains were capped by profit-taking and lingering concerns over Syria.
Tokyo closed flat, edging up 10.95 points to 14,064.82, with little reaction after the Bank of Japan upgraded its assessment of the world's number three economy. Seoul finished up 0.96 percent, or 18.62 points, at 1,951.65, while Hong Kong rose 1.22 percent, or 271.75 points, to 22,597.97.