Active Stocks
Thu Mar 28 2024 15:59:33
  1. Tata Steel share price
  2. 155.90 2.00%
  1. ICICI Bank share price
  2. 1,095.75 1.08%
  1. HDFC Bank share price
  2. 1,448.20 0.52%
  1. ITC share price
  2. 428.55 0.13%
  1. Power Grid Corporation Of India share price
  2. 277.05 2.21%
Business News/ Money / Asian stocks mixed as China reiterates 8% growth vow
BackBack

Asian stocks mixed as China reiterates 8% growth vow


Asian stocks mixed as China reiterates 8% growth vow

Premium

Hong Kong: Asian stock markets were mixed on Thursday after China promised more efforts to support growth and create jobs—but stopped short of fresh spending measures to bolster the world’s third largest economy. European markets opened down.

Chinese premier Wen Jiabao said the government’s 4 trillion yuan (Rs30.5 trillion) stimulus plan, announced in November, would help the country achieve 8% growth this year. That rate is seen as critical to creating jobs and staving off social unrest as the worst global economic crisis in generations hits Chinese exports.

As the government boosts money for infrastructure, social programmes and tax cuts, the country’s budget deficit will surge to its highest level in six decades, Wen said at China’s annual legislative session in Beijing.

Global markets had rallied along with commodities prices the day before, partly on hopes China would announce new steps to counter a slowdown in its economy and help other countries restart theirs in the process.

But some investors turned cautious after Beijing largely reinforced programmes and spending already known.

The programme outlined in Wen’s nationally televised speech, while supplying a short-term jolt to confidence with its reiteration of the 8% growth target, was unlikely to bring about a lasting recovery in global markets, analysts said. With Western economies and the global financial system still in tatters, any spillover effects from China would be limited.

“Knowing China will be spending is comforting, but we have doubts whether this will help other countries’ economies in the end," said Kelvin Lau, a regional economist at Standard Chartered Bank in Hong Kong.

After opening higher, Asian stocks started to pare their gains by the afternoon as many investors booked profits from Wednesday’s rally.

Japan’s Nikkei 225 stock average rose 142.53, or 2%, to 7,433.49 while South Korea’s Kospi ended down 0.1% at 1,058.18 in a choppy session. In China, Shanghai’s benchmark gained 1% to 2,221.08, fluctuating in and out of the red, after jumping at least 6% the day before.

Hong Kong’s Hang Seng lost 118.76, or about 1%, to 12,212.39. Benchmarks in Australia and Taiwan gained while Singapore and Indian stock measures fell.

As trading opened in Europe, benchmarks in Britain, Germany and France were off about 1% or more ahead of expected interest rate cuts from the European and British central banks. Both were expected to slash benchmark rates to new record lows.

Overnight, Wall Street snapped a five-day losing streak, buoyed by China stimulus hopes as well as details of a Washington programme to help as many as nine million borrowers stay in their homes through refinanced mortgages or loans. The Dow Jones Industrial Average rose 149.82, or 2.2%, to 6,875.84. Broader indexes also rose. The Standard and Poor’s 500 Index added 16.54, or 2.4%, to 712.87.

US futures pointed to a lower open on Wall Street. Dow futures were down 52 points, or 0.8%, at 6,778 and S&P500 futures were off 6.8, or 1%, at 701.60.

Investors in Asia and beyond are likely to pay close attention to Friday’s release of US employment figures, a key barometer of the world’s largest economy and the health of consumers whose spending is critical to Asia’s export-driven economies.

In Japan, the sinking yen helped some car makers and technology companies reliant on overseas demand. Mazda Motor Corp. shot up 10.5%, while Nissan Motor Co. rose 6.1%. Nikon Corp. finished up 4.6%. The rise in resource prices lifted some commodities plays, including Australian mining firm BHP Billiton Ltd, up 4.4%.

After soaring overnight, oil prices slipped in Asian trade, with benchmark crude for April delivery off 76 cents at $44.61 (Rs2,324) a barrel.

Unlock a world of Benefits! From insightful newsletters to real-time stock tracking, breaking news and a personalized newsfeed – it's all here, just a click away! Login Now!

Catch all the Business News, Market News, Breaking News Events and Latest News Updates on Live Mint. Download The Mint News App to get Daily Market Updates.
More Less
Published: 05 Mar 2009, 10:54 PM IST
Next Story footLogo
Recommended For You
Switch to the Mint app for fast and personalized news - Get App