European stocks recover from US housing data
June 17, 2010 A U.S. government report said construction of homes and
apartments fell 10 percent in May, worse than economists were
expecting.
In Europe, Britain's FTSE 100 closed up .39 percent at 5237.92,
capping what market analyst James Hughes characterized as "a
pretty lifeless session." Despite dips in earlier trading,
Germany's DAX rose 0.26 percent to 6190.91 and France's CAC-40 fell
grew by .39 percent to 3675.93.
The construction news took a harder toll on Wall Street. A day
after the Dow Jones industrials rose 214 points to the highest
close in nearly a month, it fell to 10,395. The Standard & Poor's
500 index was up .75 points at 1,115.98.
While some bullish manufacturing data out of the United States
on Wednesday boosted Asian and European stocks in earlier trading,
the housing figures dampened spirits.
Investors also saw risks for big oil companies' shares after
President Barack Obama vowed to make BP pay for the devastating oil
spill in the Gulf of Mexico.
BP shares were down just 0.5 percent at 340.25 pence ($5.03) on
the London Stock Exchange after briefly trading higher. They had
traded at about 655 pence before the April 20 explosion which
killed 11 workers on the drilling rig.
Spanish shares were down 1.3 percent after local daily El
Economista reported that the International Monetary Fund and
European Union were preparing a financial backstop for Spain.
Finance ministry officials in Spain denied the report.
The euro edged down to $1.2322 from $1.2321.
In Asia, gains were broad-based and strong. Japan's Nikkei 225
stock average rose 179.26, or 1.8 percent, to 10,067.15, breaking
above the key 10,000 level for the first time in almost a month.
Australia's ASX/S&P 200 advanced 1.2 percent to 4,559.00, the
Kospi in South Korea gained 0.9 percent to 1,705.33 and Singapore's
benchmark rose 1 percent to 2,846.05. Financial markets in Hong
Kong, mainland China and Taiwan were closed for the last day of
public holidays.
World markets have dropped along with the euro since May amid
growing concerns that weaker European countries such as Greece
would default on debt. Investors also were afraid that the budget
cuts that countries such as Greece, Spain and Portugal have had to
implement will slow their economic growth. The concern was that
growth across the continent and the rest of the world would also be
hurt.
The gains outside Europe suggest investors there have started to
put aside some of their unease about Europe and focus on continuing
signs of strength in Asia and the U.S.
In New York Tuesday, the Dow Jones industrials climbed 2.1
percent to 10,404.77 - its highest close since May 19 - after
Boeing Co. said it was boosting production and an industry group
forecast that demand for computers would increase.
The broader Standard & Poor's 500 index advanced 2.4 percent to
1,115.23, and the tech-dominated Nasdaq composite index surged 2.8
percent to 2,305.88.
In Tokyo trade, Japanese exporters benefited from a weaker yen
against the euro. Canon Inc. jumped 3.9 percent and Sony Corp.
added 1 percent.
Nintendo Co. surged 5.2 percent after the company unveiled a 3-D
version of its popular handheld gaming device. In an effort to stay
ahead of its rivals, Nintendo also announced Tuesday updates to
classic game franchises like "Donkey Kong" and "Kirby" at the
E3 Expo in Los Angeles.
Higher commodities prices sent resource names higher in
Australia, with miner BHP Billiton Ltd. gaining 2.1 percent.
In currencies, the dollar rose to 91.68 yen from 91.52 yen in
New York late Tuesday.
Benchmark crude for July delivery was down 20 cents at $76.73 a
barrel in electronic trading on the New York Mercantile Exchange.
The contract rose $1.82 to settle at $76.94 on Tuesday.