World shares rise, shrug off slower China growth
AP and AFP
April 17, 2014, 12:00 am TWN
TOKYO -- World stock markets rose Wednesday as China's slowdown in the first quarter was less severe than expected.
Germany's DAX rose 0.6 percent to 9,234.84 and France's CAC 40 added 0.8 percent to 4,378.67. Britain's FTSE 100 climbed 0.6 percent to 6,578.19.
Wall Street looked headed for an upbeat start, with Dow Jones and S&P 500 futures were both 0.4 percent higher.
Investors took heart from the fact the slowdown in China's growth in the first quarter was a bit less marked than expected. The world's second-largest economy expanded 7.4 percent from a year earlier, the slowest expansion since the third quarter of 2012, but better than the average forecast of 7.3 percent growth.
"The more frequent monthly data points — fixed asset investment, industrial production and retail sales — were mixed but on the whole improved," said IG chief strategist Chris Weston in a market commentary.
China's economy grew 7.7 percent in the final quarter of last year. Beijing is targeting 7.5 percent growth for 2014.
China's National Bureau of Statistics spokesman Sheng Laiyun said the economy "performed within a proper range, with structural adjustment, economic transformation and upgrading continuing to make progress."
But he added: "We should keep in mind that the external environment remains complicated and volatile, and the national economy still faces downward pressure."
There are increasing fears of a slowdown in the Chinese economy, a key driver of regional and global growth, following a string of weak data, including on manufacturing and trade.
That in turn has fuelled speculation that Beijing will announce measures to kickstart growth, such as by lowering the amount of cash that banks must keep in reserve, which would boost lending.
Mark McFarland, global chief economist at Coutts Private Bank, told Dow Jones Newswires that while Wednesday's data was weak, "under the circumstances, it actually isn't bad."
He added that markets should forget about stimulus for now as China focuses on reining in credit growth.