Asia shares rise ahead of China GDP; Europe down
AP and AFP
July 16, 2014, 12:03 am TWN
TOKYO/HONG KONG--European stocks were mostly lower Tuesday, led by a decline in Germany's Software AG, after a strong day in Asia on hopes for stronger Chinese economic growth.
Germany's DAX fell 0.6 percent to 9,721.63 and France's CAC-40 dropped 0.7 percent to 4,318.94. Britain's FTSE 100 slipped 0.2 percent to 6,730.77.
The share price of Frankfurt-listed Software AG, a top business software company, plunged nearly 15 percent Tuesday after it announced a downward revision in its revenue forecast due to delays on big projects.
Prospects for U.S. trading appeared muted, with Dow and S&P 500 futures both down 0.1 percent.
But expectations that U.S. Federal Reserve Chairwoman Janet Yellen will stick to a stance of keeping interest rates low during testimony in Congress this week is helping support sentiment despite the Fed's plans to gradually scale back its asset purchases.
Asian shares mostly rose Tuesday, taking their lead from a second straight advance on Wall Street, while investors await a string of market-moving news and data over the next few days.
The broad Asian gains add to Monday's positive performance and provided support to the dollar after it took a hit last week.
Tokyo rose 0.78 percent, or 119.84 points, to 15,416.66 thanks to the weaker yen, with investors largely unmoved by the Bank of Japan's (BOJ) expected decision to stand pat on monetary policy.
Seoul jumped 0.94 percent, or 18.84 points, to end at 2,012.72 and Sydney closed flat, edging down 0.1 points to 5,511.3.
Shanghai closed 0.18 percent higher, adding 3.71 points to 2,070.36. Hong Kong added 0.49 percent, or 113.29 points, to 23,459.96.
New York's three main indexes ended higher Monday thanks to better-than-forecast earnings from banking titan Citigroup, which was described by Wall Street rival Bank of America Merrill Lynch as “encouraging for large peers that report earnings this week”.
In Japan the central bank held off announcing any widening of its stimulus program, saying the economy was recovering despite April's sales tax rise, although it revised down its growth forecast for the fiscal year to March.
“It came as no surprise that the BOJ left policy settings unchanged today and presented upbeat inflation forecasts, but we still think more easing will be announced in October,” said Marcel Thieliant from Capital Economics.
Later Tuesday will see U.S. Federal Reserve chief Yellen begin two days of congressional testimony, with traders hoping for more detail on the bank's timeframe for raising interest rates.
Also in sight is a U.S. retail sales report for June and earnings from some major U.S. companies, including JPMorgan Chase and Goldman Sachs.
However, the main focus this week in Asia is on China's second-quarter gross domestic product growth figures, which are due on Wednesday.
Gold dipped. It fetched US$1,312.34 an ounce at 1115 GMT compared with US$1,321.37 late Monday.