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Global stocks mostly lower ahead of US jobs data

August 02, 2017 - 5:19 AM

SEOUL, Korea, Republic Of - Global stocks mostly turned lower on Wednesday amid reports that the U.S. is considering a move that would allow it to put tariffs on some Chinese imports. Investors will also monitor U.S. jobs data ahead of the key payrolls report on Friday.

KEEPING SCORE: Germany's DAX dropped 0.2 per cent to 12,227 and the CAC 40 of France edged 0.1 per cent lower to 5,121. Britain's FTSE 100 slipped 0.4 per cent to 7,392. Wall Street looked set for gains with Dow futures up 0.2 per cent and the S&P 500 futures up almost 0.1 per cent.

CHINA TRADE: President Donald Trump's administration may use rarely invoked U.S. trade laws to fend off China's demands that foreign companies share their technology in return for access to the Chinese markets, according to a person familiar with the matter. The law allows Washington to investigate China's trade practices and raise tariffs on imports from China or impose other sanctions. The move comes as Trump's administration appears set to adopt a harsher stance toward Beijing than it did during the initial months after the inauguration.

ECONOMIC DATA: Factory output data in China, Europe and the U.S. released this week were encouraging, while the Institute for Supply Management reported that U.S. factory production rose again last month though at a slower pace than in June. Later Wednesday, U.S. payroll processor ADP will give its employment updates for July. But the biggest highlight will be the U.S. jobs report due Friday.

ANALYST'S COMMENT: "Tonight, investors will closely watch the ADP private payroll number to assess the health of the jobs market," said Margaret Yang, a market analyst at CMC Markets in Singapore. "A higher figure indicates rising employment and potential inflation pressure, which will increase the likelihood of rate hikes."

IPHONE IMPACT: Apple reported Tuesday that its quarterly earnings rose 12 per cent to $8.7 billion, exceeding expectations, as demand for iPhones rose and gave an upbeat revenue forecast for the current quarter, easing concerns about production problems for the next-generation iPhone. Shares of Apple's suppliers in Asia rose. Samsung Electronics Co. rose 0.8 per cent and LG Display Co. jumped 1.8 per cent. Taiwan-based contract manufacturer Foxconn Technology Co., which assembles Apple's iPhones, climbed 2.2 per cent.

ASIA'S DAY: Japan's Nikkei 225 rose 0.5 per cent to 20,080.04 and South Korea's Kospi gained 0.2 per cent to 2,427.63. Hong Kong's Hang Seng index advanced 0.2 per cent to 27,607.38 while the Shanghai Composite index shed 0.2 per cent to 3,285.06. Australia's ASX/S&P 200 bucked the region's trend, falling 0.5 per cent to 5,744.20 as commodity prices dropped. Stocks in Southeast Asia were mostly higher.

OIL: Benchmark U.S. crude fell 8 cents to $49.08 per barrel in electronic trading on New York Mercantile Exchange. The contract shed $1.01 on Tuesday. Brent crude, the international standard, rose 2 cent to $51.80 per barrel in London. It dropped 94 cents the day before.

CURRENCIES: The dollar rose to 110.72 yen from 110.36 yen. The euro strengthened to $1.1830 from $1.1802.

News from © The Associated Press, 2017
The Associated Press

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