A roundup of trading on major world markets:
NEW YORK – US stocks dropped more than one per cent on Thursday, a day before a closely watched report on the jobs market will show whether prospects are improving for the world’s largest economy.
The Dow Jones Industrial Average slumped 119.96 points (1.03 per cent) to close at 11,493.57.
The broader S&P 500 sank 14.47 points (1.19 per cent) to 1,204.42, while the tech-heavy Nasdaq Composite tumbled 33.42 points (1.30 per cent) to close at 2,546.04.
Wall Street enjoyed an early rally after a report on US manufacturing beat expectations, but the gains faded and markets went into the red amid concern over Friday’s data on US nonfarm payrolls and unemployment.
Economic data from around the world was mixed on Thursday, but reflected softness in manufacturing and in the US labour market.
In the United States, the Institute for Supply Management put the reading for its monthly manufacturing survey at 50.6 per cent, lower than in July but above analysts’ expectations. A number above 50 reflects expansion.
Separately, US government data showed that initial jobless claims fell by 12,000 in the week ending August 27, but still remained stubbornly high at 409,000.
Bond prices climbed. The yield on the 10-year Treasury note fell to 2.15 per cent from 2.22 per cent late Wednesday, while that on the 30-year bond dropped to 3.51 per cent from 3.59 per cent.
Bond prices and yields move in opposite directions.
LONDON – European stocks have ended mixed following volatile trading as stable US manufacturing data helped outweigh dismal figures from Europe, while the euro slid against the dollar.
London’s FTSE 100 index of leading companies ended the day up 0.45 per cent at 5,418.65 points and in Paris the CAC 40 gained 0.28 per cent to 3,265.83 points. Frankfurt DAX dropped 0.94 per cent, however, to 5,784.85 points.
In foreign exchange deals, the European single currency sank to a two-and-a-half-week low of $US1.4227. It later rallied back to $US1.4262 but was still down from $US1.4374 late in New York on Wednesday.
The US dollar rose to 76.91 yen after 76.62 yen.
European stocks sagged early in the day after the release of data showing eurozone manufacturing hit reverse gear in August, tumbling to a two-year low, in a fresh sign the economy is slowing fast.
The eurozone manufacturing purchasing managers’ index (PMI) compiled by Markit fell to 49.0 points in August from 50.4 in July. Any score below 50 indicates contraction, while anything above suggests expansion.
Only Germany, the Netherlands and Austria posted manufacturing growth, with France, Italy and Spain slumping into negative territory.
British manufacturing tumbled to a 26-month low of 49.0 points in August, although that beat market expectations for a reading of 48.5 according to analysts polled by Dow Jones Newswires.
However, London’s FTSE-100 got a boost from a surge in banking stocks on a report in the Financial Times that a reform of the British banking system to better separate investment and retail banking activities following the 2008-2009 financial crisis would not get underway until 2015.
Data earlier on Thursday showed China’s PMI rose to 50.9 in August from 50.7 the previous month, which was the lowest in more than two years.
European markets later rebounded following data showing that the US manufacturing sector had avoided a contraction and was still growing.
Elsewhere in Europe, Brussels and Swiss stocks nudged up 0.05 per cent, Amsterdam climbed 0.35 per cent, Madrid gained 0.49 per cent and Milan rose 0.69 per cent.
Lisbon dipped 0.26 per cent.
Gold rose to $US1821 from $US1813.50 on Wednesday.
HONG KONG – Asian markets mostly rose, extending a recent rally, following another day of gains on Wall Street thanks to better-than-expected US manufacturing data.
The rises, which follow one of the worst ever Augusts for shares, came as market players grow a little more confident that the global economy is in a better state than they had feared.
However, a mixed bag of figures from Beijing indicated that while the world’s number-two economy was likely to not be heading for a hard landing, the outlook remained unclear.
Tokyo ended 1.18 per cent, or 105.60 points, higher at 9,060.80 and Sydney added 0.26 per cent, or 11 points, to 4,307.5. Seoul was flat, edging up 0.59 points to 1,880.70.
Hong Kong closed 0.25 per cent, or 50.48 points, up at 20,585.33, but well off early highs, while Shanghai lost 0.44 per cent, or 11.30 points, to 2,556.04 on fears rising prices could lead to further tightening measures by Beijing.
Regional stock markets continued their rebound as dealers digested better-than-expected US data showing that manufacturing in the US industrial heartland had picked up slightly.
In China the official Purchasing Managers’ Index for August from the China Federation of Logistics and Purchasing (CFLP) rose to 50.9 from 50.7 in July.
The PMI from banking giant HSBC showed a similar improving trend, rising to 49.9 in August from 49.3 in July.
Wellington closed up 0.28 per cent, or 9.20 points, at 3,332.27.
Singapore closed down 18.08 points, or 0.63 per cent, to 2,867.18.
WELLINGTON – The NZ stock market closed up 9.20 points, or 0.28 per cent, at 3,332.27.
Telecom slipped 1.6 percent to $NZ2.50, Air New Zealand rose 0.9 per cent to $NZ1.12 and casino operator Sky City gained 1.8 per cent to $NZ3.42.
