MANILA, Philippines - Asian stocks including the Philippines wavered yesterday as uncertainties persisted about what authorities in the US, China and Europe might do to deal with a souring global economy.
The previous day’s trading was dominated by a survey suggesting that China’s manufacturing sector was contracting. Though a bad sign for the global economy, the data has raised expectations that Chinese authorities will launch some kind of stimulus to help the economy.
But Chinese authorities appear to be resisting calls for more aggressive measures after the huge stimulus in response to the 2008 global financial crisis fueled inflation and a wasteful spending boom.
At the Philippine Stock Exchange (PSE) , the main composite index dropped 43.21 points or 0.83 percent to close at 5,175.87. Over 1.92 billion shares valued at P4.72 billion were traded.
Market breadth was negative with losers outnumbering winners 102 to 54, with 49 issues unchanged.
Most markets in Asia were also down with Japan’s Nikkei 225 index falling 0.1 percent to 8,775.51. Hong Kong’s Hang Seng lost 0.1 percent to 19,433.30 and South Korea’s Kospi was nearly unchanged at 1,913.17. Australia’s S&P/ASX 200 fell 0.4 percent to 4,314.40.
European markets posted solid gains on Monday. Britain’s FTSE 100 advanced 0.8 percent to 5,758 while Germany’s DAX added 0.6 percent to 7,014. The CAC-40 in France was 1.19 percent higher at 3,453. Markets in the US were closed for the Labor Day holiday.
Investors around the world will have a number of issues to contend with over the rest of the week, which culminates with Friday’s US nonfarm payrolls report for August.
Meanwhile, on Sept. 12, Germany’s constitutional court is set to issue its verdict on the legality of the European Stability Mechanism, Europe’s planned bailout fund.
Hopes that the ECB will play a more crucial role in the debt crisis have helped support the euro in recent weeks. After nearly dropping to near two-year lows below $1.20, the euro has pushed back above $1.25. – AP
The US payroll figures, which often set the market tone for a week or two after their release, could be particularly important this month too. Last Friday, Federal Reserve Chairman Ben Bernanke suggested that more central bank action was possible to support the U.S. economy, leading investors to think the Fed will act sooner rather than later. Previous Fed stimulus packages have shored up markets as the fresh liquidity on offer made its way round financial markets.
Benchmark oil for October delivery was up 70 cents to $97.17 a barrel in electronic trading on the New York Mercantile Exchange. The contract rose $1.85 to finish at $96.47 Friday. --AP