Market Commentary and Intraday News
Soft Start Called For Hong Kong Stock Market
288 days ago
(RTTNews) - The Hong Kong stock market on Monday wrote a finish to the three-day losing streak in which it had fallen almost 330 points or 1.7 percent. The Hang Seng Index closed just below the 19,560-point plateau, and now traders are preparing for renewed if mild weakness when the market opens on Tuesday.
The global forecast for the Asian markets is mixed with a hint of weakness after ratings agency Moody's downgraded the outlook for the European Union to negative from stable. A decline in Germany's manufacturing activity also may weigh on investors. The European markets were higher on Monday, while the U.S. bourses were closed for the Labor Day holiday - and the Asian markets are expected to open lower.
The Hang Seng finished modestly higher on Monday as gains from the property stocks were hurt by weakness from the exporters.
For the day, the index added 76.64 points or 0.39 percent to finish at 19,559.21 after trading between 19,386.04 and 19,608.55 on turnover of 38.92 billion Hong Kong dollars.
Among the actives, China Resources Land jumped 4.8 percent and China Overseas Land climbed 3.7 percent, while Li & Fung shed 2.5 percent and China Cosco dropped 1.4 percent.
There is no lead from Wall Street, which was closed for the Labor Day holiday, while the news from Europe is mixed - with caution also growing ahead of Friday's all-important nonfarm payroll data from the United States.
Adding to the pessimistic outlook, ratings agency Moody's on Monday downgraded the European Union's outlook to negative from stable, citing a weakened outlook for the region's largest economies and deterioration in credit-worthiness of certain members. The EU's AAA rating was unaffected.
On the economic front, Germany's manufacturing activity declined more than initially estimated for August, final data from Markit Economics showed on Monday. The final Markit/BME Purchasing Managers' Index came in at 44.7 in August, down from the flash reading of 45.1, but rose from 43 in July.
In a separate report, the Eurozone's manufacturing sector continued to contract in August, but a slower pace than in July, survey results confirmed. However, the improvement was slightly weaker than estimated in the flash report. In the U.K., the Markit/Chartered Institute of Purchasing & Supply Purchasing Managers Index rose more than expected to 49.5 from 45.2 in July. Economists had forecast the index to rise to 46.3.
The major European markets were firmly higher on Monday as the DAX in Germany picked up 0.63 percent, while the CAC 40 in France surged 1.19 percent, London's FTSE collected 0.82 percent and the Swiss market added 0.78 percent.
In economic news, China's non-manufacturing sector growth accelerated in August, data from the China Federation of Logistics and Purchasing showed on Monday. The purchasing managers' index for the non-manufacturing sector rose to 56.3 in August from 55.6 in July. A PMI reading above 50 indicates expansion of the sector, while a reading below 50 suggests contraction.
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