News Column

Most Asian stocks decline as ECB boosts Europe

June 7, 2014

European stocks edged higher a day after the European Central Bank unveiled new measures to boost economic growth but other benchmarks struggled Friday as investors awaited the US jobs report for May.

Global market reaction to the ECB measures, which included interest rate cuts and a new liquidity programme for banks, was short-lived as investors focused on the jobs data. In early European trading, Germany's DAX rose 0.2 per cent to 9,969.12 and France's CAC 40 gained 0.1 per cent to 4,555.33. Britain'sFTSE 100 advanced 0.3 per cent to 9,835.02.

US stocks were poised to open higher. Dow futures edged up 0.2 per cent to 16,487.00 and S&P 500 futures were up less than 0.1 per cent to 1,939.70.

Most Asian benchmarks ended lower. Japan'sNikkei 225 closed nearly flat at 15,077.24 while Hong Kong's Hang Seng slipped 0.7 per cent to 22,951.04.

In mainland China, the Shanghai Composite Index lost 0.5 per cent to 2,029.96. Australia's S&P/ASX 200 rose 0.5 per cent to 5,464.00. Markets in South Korea were closed for a holiday.

"Today, the US jobs report garners most focus while investors continue to digest the ECB decision," strategists at Credit Agricole CIB said in a report.

Analysts forecast that US employers added 220,000 jobs last month after adding 288,000 in April. A fourth straight 200,000-plus monthly job gain would add to evidence that the job market in the world's biggest economy is strengthening.

The monthly US jobs report "at present seems to be one of the few economic releases that is still able to make significant waves in markets," said Michael Every, head of Asia financial markets research at Rabobank.

Markets may cheer even if number comes in lower than expected, because it would raise the prospect of policymakers delaying their scaling back of monetary stimulus, Every said.

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Source: Khaleej Times (United Arab Emirates)

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