Scoop has an Ethical Paywall
Work smarter with a Pro licence Learn More

Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 

While you were sleeping: China, Greece optimism

While you were sleeping: China, Greek optimism

Nov 23 (BusinessDesk) – Investors opted to focus on good news today, concentrating on data showing Chinese manufacturing expanded in November, even as separate data showed euro-area services and manufacturing output is now the worst in three years.

Underpinning sentiment was confidence by Olli Rehn, the European commissioner for economic affairs, that euro zone finance ministers will reach an agreement on Greece by Monday, releasing the next tranche of aid to avoid the country's financial collapse.

"I trust everyone will reconvene in Brussels on Monday with the necessary constructive spirit, and move beyond the detrimental mindset of red lines," Rehn told European Parliament, according to Reuters.

Meanwhile, a Chinese manufacturing index rose to 50.4 in November from 49.5 last month, HSBC Holdings and Markit said in a report. That marked the first expansion in 13 months and helped bolster hopes that the world's second-largest economy might be in better shape than feared.

"There are questions over whether the Chinese economy is really that bad or if the US will take a long time to recover, but we are getting signs that the situation is not as bad as assumed," Peter Braendle, head of European equities at Zurich-based Swisscanto Asset Management, told Reuters.

In Europe, the Stoxx 600 Index finished the day with 0.6 percent climb from the previous close. France’s CAC 40 gained 0.6 percent, while the UK’s FTSE 100 advanced 0.7 percent and Germany’s DAX climbed 0.8 percent.

Advertisement - scroll to continue reading

Are you getting our free newsletter?

Subscribe to Scoop’s 'The Catch Up' our free weekly newsletter sent to your inbox every Monday with stories from across our network.

And the euro drew heart too. The currency rose 0.4 percent to US$1.2880, after earlier rising as high as US$1.2899.

"Chinese activity has been picking up since September and it’s an indication that the economy has stabilised,” Gopal Agrawal, who helps oversee US$1 billion as chief investment officer at Mirae Asset Global Investments (India), told Bloomberg News.

However, there remains plenty to worry about in the euro zone. A composite index based on a survey of purchasing managers in services and manufacturing industries in the euro zone was little changed at 45.8 in November compared with 45.7 in October, Markit Economics data showed today. Activity has now fallen in 14 of the last 15 months.

“The euro zone economy continued to deteriorate at an alarming pace in November, and is entrenched in the steepest downturn since mid-2009," Chris Williamson, chief economist at Markit, said in a statement.

"While it is reassuring to have seen signs of stabilisation in some survey indicators, the overall rate of decline remains severe and has spread to encompass Germany, suggesting the situation could deteriorate further in the coming months," Williamson said.

Spain, however, managed to draw solid demand for today's debt auction. The nation surpassed its maximum target at a sale of debt due in 2015, 2017 and 2021, selling 3.88 billion euros, compared with a maximum target of 3.5 billion euros, according to Bloomberg.

"It's a clear reflection that sentiment in Spain has improved markedly," bond strategist at RIA Capital Markets Nick Stamenkovic, told Reuters. "They are already funded for 2012 and the market is betting that Spain will ask for a bailout early next year when they face a [wall of issuance]."

Wall Street was closed for the Thanksgiving holiday today. Tomorrow is Black Friday, the biggest sales day for US retailers. Trading in US stocks will resume tomorrow though in a shortened session.

(BusinessDesk)

© Scoop Media

Advertisement - scroll to continue reading
 
 
 
Business Headlines | Sci-Tech Headlines

 
GenPro: General Practices Begin Issuing Clause 14 Notices

GenPro has been copied into a rising number of Clause 14 notices issued since the NZNO lodged its Primary Practice Pay Equity Claim against General Practice employers in December 2023.More

SPADA: Screen Industry Unites For Streaming Platform Regulation & Intellectual Property Protections

In an unprecedented international collaboration, representatives of screen producing organisations from around the world have released a joint statement.More

 
 
 
 
 
 
 
 
 
 
 
 

Join Our Free Newsletter

Subscribe to Scoop’s 'The Catch Up' our free weekly newsletter sent to your inbox every Monday with stories from across our network.