Global shares mixed following Wall Street retreat

Tokyo: Global shares meandered Tuesday after a retreat on Wall Street. France’s CAC 40 was little changed, inching down less than 0.1 per cent in early trading to 4,945.35.

Germany’s DAX added 0.6 per cent to 13,018.55, while Britain’s FTSE 100 fell 0.7 per cent to 5,921.03. U.S. shares were set for gains, with Dow futures up 0.2 per cent at 28,481.0. S&P 500 futures rose nearly 0.4 per cent to 3,511.38.

In Asia, Australia’s benchmark led the declines, falling nearly 2 per cent as the Reserve Bank of Australia decided to keep interest rates at record lows, as expected.

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The Japanese government reported that the seasonally adjusted unemployment rate for July stood at 2.9 per cent, little changed from recent months.

Japan’s benchmark Nikkei 225 index was flat, finishing at 23,138.07, and the Hang Seng in Hong Kong also was little changed at 25,184.85.

South Korea’s Kospi gained 1.0 per cent to 2,349.55. The Shanghai Composite index added 0.4 per cent to 3,410.61. The S&P/ASX 200 dropped 1.8 per cent to 5,953.40.

Stocks have had a choppy session in Asia, with investors shifting to and fro between COVID resurgence, central bank stimulus, and the convincing economic rebound in China, said Stephen Innes, chief global market strategist at AxiCorp.

He noted that a survey of purchasing managers, the Caixin PMI, beat expectations at 53.1, the fastest rise in August for nearly a decade. The index is on a scale up to 100, with 50 being the cutoff between expansion and contraction.

Although the pandemic started in China, that economy has been among the first to rebound. Export-oriented nations in Asia are likely to be instant beneficiaries of a China revival.

This should provide a boost to local stocks as well as global commodity markets, Innes said.

Leaders of Japan’s governing Liberal Democratic Party were negotiating over who will replace Prime Minister Shinzo Abe after he steps down.

Abe has announced he would resign due to health problems. Expectations are high his successor will continue the Abenomics policies he launched in early 2013, aimed at spurring growth through massive central bank stimulus and cheap credit.

Encouraging economic data as broad swaths of economies reopened this summer have helped stoke investor optimism about a recovery.

The question is whether that’s going to be enough to keep markets moving higher when so much uncertainty remains about the pandemic’s lasting impact on companies and consumers.

Benchmark U.S. crude oil added 52 cents to USD 43.13 a barrel in electronic trading on the New York Mercantile Exchange. It fell 36 cents to USD 42.61 a barrel on Monday. Brent crude, the international standard, rose 56 cents to USD 45.84 a barrel.

The U.S. dollar fell to 105.63 Japanese yen from 105.94 yen. The euro cost USD 1.1982, up from USD 1.1940.

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