A roundup of trading on major world markets:
NEW YORK – US stocks have fallen after weak economic data in China and Europe reignited worries about global growth, while oil prices dropped for a second day, dragging down energy shares.
Bucking the day’s trend, Apple rose 1.6 per cent to $US95.18, breaking an eight-session streak of losses.
Activity in China’s factories shrank for the 14th straight month in April as demand stagnated, a private survey showed.
Britain’s manufacturing output also unexpectedly shrank last month to its lowest level in three years.
US oil prices settled down 2.5 per cent as rising output from the Middle East renewed concerns about global oversupply. The S&P energy index, down 2.2 per cent, led declines in the benchmark index.
“We had a nice rally yesterday, and in essence we’re peeling that back today. The market is stuck in a trading range that is at the intersection of full valuations in US equities and news that has not been necessarily overwhelming positive,” said Mark Luschini, chief investment strategist at Janney Montgomery Scott in Philadelphia.
The Dow Jones industrial average closed down 140.25 points, or 0.78 per cent, to 17,750.91, the S&P 500 lost 18.06 points, or 0.87 per cent, to 2,063.37 and the Nasdaq Composite dropped 54.37 points, or 1.13 per cent, to 4,763.22.
LONDON – European shares fell to a three-week low, with Commerzbank leading the decline after a slump in profits and mining stocks falling along with metals prices.
Traders said media reports about Commerzbank’s role in a tax-evasion scheme also weighed on the stock.
Commerzbank said its internal systems made sure that all trades were consistent with German law.
The STOXX Europe banking index fell 3.7 per cent and the basic resources index lost 6.4 per cent. Prices of major industrial metals fell after a survey released on Tuesday showed Chinese manufacturing activity shrank for a 14th straight month in April.
“The dollar is going softer and there are some concerns that the currency is no longer a tailwind for some companies. The results season is not bad overall so far, but I would doubt that the earnings outlook will really improve that significantly as expected. The impact from pricing power is still rather weak,” said Gerhard Schwarz, head of equity strategy at Baader Bank in Munich.
The pan-European FTSEurofirst 300 index fell 1.7 per cent at 1,318.9 points, its lowest closing since April 12.
The FTSE 100 fell 56.30 points, or 0.90 per cent, to 6185.59 while Germany’s DAX lost 196.50 points, or 1.94 per cent, to 9,926.77.
HONG KONG – The US dollar has slid to its lowest against major currencies in well over a year, a move led by the yen’s continued march higher as investors grew doubtful about central banks’ ability to boost growth through aggressive policy easing.
That did not stop Australia’s central bank surprising markets by cutting interest rates to a record low of 1.75 per cent, however, hitting the currency but lifting the country’s shares.
MSCI’s broadest index of Asia-Pacific shares outside Japan fell to a three-week low and the euro’s burst through $US1.16 for the first time in eight months pushed European shares deeply into the red.
Analysts at Rabobank noted the US dollar’s fall towards Y105 from as high as 122 only a few months ago, a remarkable move that will do nothing to relieve the deflationary pressures in Japan and which reflects “the broader problem of unconventional monetary policy reaching its limits just like conventional policy already has”.
The yen rallied to 105.60 per US dollar, its highest since October 2014.
Japan is in the middle of its Golden Week series of holidays. Markets are closed from Tuesday to Thursday.
The Hang Seng lost 390.11 points, or 1.85 per cent, to 20676.94, while the Shanghai gained 56.80 points, or 1.80 per cent, to 3213.54.
WELLINGTON – The S&P/NZX 50 Index gained 51.2 points, or 0.8 per cent, to 6,843.01.
