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Asian Stocks Fall on Weak Chinese Trade Data Wall Street Opens Lower on Weak Chinese Trade Data
(about 1 hour later)
TOKYO — Asian stocks fell sharply on Monday and the dollar dropped from recent highs as surprisingly weak Chinese trade data rattled investors already on edge over the crisis in Ukraine. Wall Street opened lower on Monday with unexpectedly weak data in China tempering enthusiasm over the strength of the global economy.
But European stocks did not continue the trend, with most major indexes higher through late-morning trading. In early trading the Dow Jones industrial average was down 0.30 percent and the Standard & Poor’s 500-stock index was down 0.14 percent. The Nasdaq composite index was down 0.05 percent.
Data issued over the weekend showed China’s exports unexpectedly tumbled 18 percent in February, swinging the trade balance into deficit and adding to fears of a slowdown in the Chinese economy, the world’s second-largest. China’s exports unexpectedly tumbled 18.1 percent in February, against expectations of a 6.8 percent rise, swinging the trade balance into deficit and adding to fears of a slowdown in the world’s second-largest economy, despite the Lunar New Year holidays being blamed for the slide.
The soft Chinese data dampened investment enthusiasm, which had been temporarily lifted by stronger-than-expected United States nonfarm payroll data released Friday. Those figures showed employers had added 175,000 jobs last month, up from 129,000 new positions in January. The data weighed on positive sentiment generated by Friday’s better-than-expected United States payrolls report, which sent the S.&P. 500 to a record high for a second consecutive session.
In a speech at the Bank of France, the Philadelphia Fed president, Charles Plosser, said severe winter weather probably affected job growth in February, the latest United States central banker to suggest that some weakness in the labor market was only temporary, indicating the Fed will stay on course in winding down its stimulus measures.
Boeing said on Friday that “hairline cracks” had been discovered in the wings of about 40 787 Dreamliners that are in production, another setback for the company’s newest jet. Separately, the disappearance of a Malaysian jetliner, a Boeing 777-200ER, is an “unprecedented aviation mystery,” a senior official said on Monday. Shares were down 2.5 percent in early trading.
Freeport McMoRan Copper & Gold lost 1.4 percent as concerns over China sent London copper to an eight-month low.
McDonald’s reported a bigger-than-expected drop in comparable global sales at established restaurants for February, with competition and bad weather battering United States sales. Shares were down slightly in early trading.
Chiquita Brands and an Irish rival, Fyffes, Europe’s largest distributor, have struck an all-stock merger deal to create the world’s biggest banana supplier. Chiquita shares jumped 15 percent.
United Rentals, the world’s largest equipment rental company, said on Sunday that it had agreed to acquire the privately held National Pump, the second-largest specialty pump rental company in North America, for $780 million. Its shares were up 2.8 percent.
Asian stocks fell sharply and the dollar dropped from recent highs, but European stocks did not continue the trend, with most major indexes higher through late-morning trading.
MSCI’s broadest index of Asia-Pacific shares outside Japan lost 1.4 percent, and the Nikkei stock average in Tokyo shed 1 percent, retreating from a six-week high reached on Friday. The CSI 300 index in China slid to its lowest point in nearly nine months, and the Hang Seng Index in Hong Kong shed 1.8 percentMSCI’s broadest index of Asia-Pacific shares outside Japan lost 1.4 percent, and the Nikkei stock average in Tokyo shed 1 percent, retreating from a six-week high reached on Friday. The CSI 300 index in China slid to its lowest point in nearly nine months, and the Hang Seng Index in Hong Kong shed 1.8 percent
Stock futures in the United States seemed poised for a day of subdued trading, after their record closing high on Friday. European shares faded through the morning, and the continued weakness in the DAX and big German firms that sell to Russia offset gains by Portuguese, Italian and Spanish stocks.
“Fundamentally speaking, data out of the U.S. has a bigger underlying market impact, but the psychological effect from Chinese economic indicators cannot be overlooked. The Nikkei’s attempt to chase further highs being derailed is a prime example,” said Koji Fukaya, the president of FPG Securities in Tokyo. “The rise in yields after the upbeat U.S. data supports the dollar,” he said, but indicators out of China dampen risk appetite “and may foil the currency’s advances against the yen.” Merger activity in France helped the CAC 40, but mining firms sensitive to China’s ferocious appetite for raw materials weighed on London’s FTSE 100 as commodities and related currencies lost altitude.
The Chinese renminbi opened trading at 6.1554 per dollar on Monday, down 0.5 percent from the Friday close of 6.1260, before moving to 6.1451. The renminbi and Chinese short-term rates fell amid expectations that Beijing was quietly easing monetary policy to buttress wobbly economic growth.
After the disappointing Chinese data, Brent crude declined 55 cents to $108.45 a barrel, ending two straight days of gains. Geopolitical tensions in Ukraine and Libya limited the falls.
“Oil pulled back because of the latest data from China, despite continuing tensions over Ukraine,” said Victor Shum, a vice president of the industry consultant IHS Energy Insights. “The ongoing situation in Ukraine will put a high floor on oil prices and lead to more volatility.”