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ASIA-MARKETS-STOCKS-UPDATE
Asian stocks edge up ahead of US growth data
SINGAPORE, July 27, 2018 (BSS/AFP) – Asian stocks mostly edged higher
Friday as investors digested results from American tech titans and waited for
the release of US data expected to show a surge in economic growth.
US markets were dragged down Thursday after Facebook warned of weaker
growth, sending its shares falling nearly 20 percent and wiping out some $100
billion in market value.
But the stock market gloom was lifted slightly after Amazon delivered
better-than-expected profits. The online colossus’ net profit in the past
quarter jumped 12-fold to $2.5 billion on the back of gains made from its
rapid global expansion.
“Earnings continue to have… (a) hold upon markets with the latest
Amazon.com surprise looking to offset some of the pressure brought about by
Facebook,” said Jingyi Pan, market strategist at trading group IG.
Tokyo closed up 0.5 percent on a weaker yen, which helps exporters, and
Sydney ended 0.9 percent higher after a deal between mining giants BHP and BP
lifted the vital mining sector. Seoul put on 0.2 percent.
Shanghai ended 0.3 percent lower while Hong Kong was little changed in
late afternoon trade.
With few trading cues in Asia, all eyes turned to the release of US data
later Friday which is expected to show an exceptional surge in economic
growth in the second quarter that President Donald Trump can use to trumpet
the success of his economic agenda.
The unusual result, which economists say could be the strongest in four
years, is partly thanks to Trump’s trade wars — but those same disputes
threaten to drag growth lower in the coming months and years.
Current forecasts say the second-quarter GDP estimate could show growth
was anywhere between four and five percent — the fastest pace since the
third quarter of 2014.
There are special factors behind the growth spurt linked to the trade
disputes, which include 25 percent US tariffs on $34 billion in Chinese goods
— with more on the way — and steep tariffs on steel and aluminium, which
provoked China and others to hit back with import duties on US goods.
MORE/HR/1402
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ASIA-MARKETS-STOCKS-UPDATE 2 LAST SINGAPORE
– Trade troubles –
Trump and European Commission chief Jean-Claude Juncker made an attempt to
resolve their festering trade dispute earlier this week, with the US leader
pulling back a threat of tariffs on the auto sector after talks in
Washington.
Stocks of French and German carmakers rallied on the news Thursday.
Europe’s stock markets were steady in opening trade on Friday, with London’s
FTSE 100 shares index up 0.2 percent and Frankfurt’s DAX 30 up 0.1 percent.
Asian markets have reacted more cautiously to the EU-US agreement, with
analysts noting that the big trade row affecting the region — with China —
is still rumbling on.
“The reality is the main game remains China and there is no sign yet that
the US is likely to back off,” said Greg McKenna, chief market strategist at
AxiTrader.
With many believing the EU had given ground to the US in their dispute,
Trump may take it as a sign “his belligerent approach is the right one”,
added McKenna.
In currency markets, the euro gained back ground following falls Thursday
after the European Central Bank left interest rates unchanged at a regular
meeting and said its planned exit from massive stimulus measures was on
track.
Oil prices were largely flat in Asian trade, as investors weighed a
decline in US crude inventories and a Saudi supply disruption against
increased production from cartel OPEC and Russia.
– Key figures at 0730 GMT –
Tokyo – Nikkei 225: UP 0.5 percent at 22,712.75 (close)
Hong Kong – Hang Seng: UP 0.03 percent at 28,788.56
Shanghai – Composite: DOWN 0.3 percent at 2,873.59 (close)
Euro/dollar: UP at $1.1656 from $1.1640
Pound/dollar: UP at $1.3116 from $$1.3101
Dollar/yen: DOWN at 110.98 from 111.24 yen
Oil – Brent Crude: DOWN seven cents at $74.47 a barrel
Oil – West Texas Intermediate: DOWN 13 cents at $69.48 a barrel
New York – Dow: UP 0.4 percent to 25,527.07 (close)
New York – S&P 500: DOWN 0.3 percent to 2,837.44 (close)
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