Global stock markets are trading in mixed order on Tuesday, awaiting the return of American investors after a long weekend in the United States and the publication, at the end of the week, of a report on American employment crucial for the monetary policy of the Federal Reserve (Fed).
In Asia, stock market indices were moving without a common direction. In Hong Kong, the Hang Seng index was down 0.32% in recent trading. Shanghai lost 0.29%, with only Shenzhen rising 1.17%. In Tokyo, the leading Nikkei index ended stable (-0.04%), benefiting from the decline in the Japanese currency, but also weighed down by the semiconductor sector, particularly because of concerns about tensions with China. On the foreign exchange market, the dollar fell 0.54% against the Japanese currency, to 146.12 yen at around 07:30 GMT. The euro also fell 0.61% to 161.67 yen and lost 0.07% against the dollar to 1.1064 dollars.
“Trading in Asia has rather shown profit-taking tendencies”comments Andreas Lipkow, independent analyst. “The weak quarterly results of some Chinese banks and real estate companies as well as the Korean carmaker Hyundai are responsible for this.”continued the analyst. In Europe, the Paris Stock Exchange was up slightly (+0.20%) around 07:30 GMT, while London (+0.06%) and Milan (+0.06% also) remained stable. Frankfurt, which closed at a record close on Monday, gained 0.23%.
Results to be published on American employment
“After a quiet start on Monday”in the absence of American investors due to a public holiday in the United States (Labor Day), “The economic calendar is expanding with the publication of the American ISM manufacturing index on Tuesday”comments Christopher Dembik, investment advisor at Pictet AM. “But it is Friday’s employment statistics that will be closely scrutinized.”he said.
While several indicators measuring the health of the labor market will be released during the week, it is Friday’s U.S. employment report that will capture investors’ attention. “These are the last figures for this key segment of the US economy before the Fed’s meeting scheduled for mid-September. Barring any last-minute surprises, the statistics should confirm the possibility of a 25 basis point rate cut by the Fed.” in September, continues Christopher Dembik.
The previous US employment report for July had disappointed market expectations. Faced with a higher-than-expected unemployment rate and a lower-than-expected number of job creations, the market feared seeing this as a signal of too strong a slowdown in the US economy and reacted very negatively. The downward movement was then accentuated by technical factors, but this air pocket has since been filled after the publication of new reassuring data.
Rolls-Royce up, Japanese semiconductors down, oil dispersed
Hong Kong airline Cathay Pacific (-0.75% in Hong Kong) has temporarily grounded its entire fleet of 48 Airbus A350s for inspections after an engine component, manufactured by Rolls-Royce, failed on a flight to Zurich on Monday. “While this news raises some concerns, our preliminary analysis indicates that the financial liability could be contained. Therefore, our positive view on the shares remains unchanged.”a Deutsche Bank analyst wrote in a note. In London, Rolls-Royce was up 3.53%.
On the Japanese stock market, stocks linked to the semiconductor industry fell amid fears of worsening trade tensions with China: Tokyo Electron lost 1.48%, Advantest 2.25% and Disco Corporation 2.87%. Oil prices were in a mixed order around 07:20 GMT: a barrel of North Sea Brent was trading at $77.37 (-0.19%) and its American equivalent, a barrel of West Texas Intermediate (WTI) rose 0.73% to $74.09. Bitcoin was down slightly by 0.14% at $58,922.
