Hong Kong shares to hold steady; StanChart in focus
Hong
Kong shares are likely to start marginally weaker to flat on Tuesday as
investors hope for further global stimulus measures, with attention on
local earnings and Standard Chartered Plc after a row over dealings with
Iran.
New York's top bank regulator said Standard Chartered was
a "rogue institution" that hid $250 billion in transactions tied to
Iran, and threatened to strip its New York banking licence. Companies expected to post corporate earnings later in the day include
MSM China, i-CABLE Communications and Hong Kong Aircraft Engineering.
Chinese property developers could come into focus after China Vanke Co
Ltd, mainland China's largest property developer by sales, reported a
25.1 percent rise in first-half net profits on Monday. But profit
margins narrowed for the housebuilder as it cut prices to win business
during a market slowdown.
Seoul shares seen in range; this week's Chinese data eyed
Seoul
shares are expected to tread in a tight range on Tuesday after hitting a
seven-week closing high in the previous session, as investors await a
string of economic data from China due later this week. Chinese
data ranging from trade and bank loans to investments will be closely
watched a s investors seek to gauge the health of the world's
second-largest economy.
Stocks may be overheating as they
rapidly approach the 1,900-point territory, but with the economic
recovery in the U.S. and China and action by global central banks
looking to slowly gain traction, the outlook for the long term looks
good," said Hanyang Securities in a note to its clients.
Nikkei seen consolidating near resistance at 25-day MA
The
Nikkei share average is expected to consolidate on Tuesday after a
solid rally and ahead of this week's Bank of Japan policy meeting and a
slew of economic data from China, Japan's largest export market.The Nikkei <.N225> was likely to trade between 8,700 and 8,800,
strategists said, after rising 2 percent to 8,726.29 on Monday.
Nikkei futures in Chicago <0#NIY:> closed at 8,740 on Monday, up
0.1 percent from the Osaka <JNIc1> close of 8,730."This
week we will have the BOJ meeting which will end on Thursday. There are a
lot of statistics from China on Thursday. The market is cautious," said
Takashi Hiroki, chief strategist at Monex Inc. The BOJ is
expected to keep monetary policy steady at its two-day meeting, but may
escalate its warnings over slowing global demand and renewed gains in
the yen, signalling its readiness to ease again if the economy's
recovery comes under threat. Hiroki said the Nikkei was likely to face resistance at its 25-day moving average of 8,742.03.
Gold up, volume thin on uncertainty over cenbanks
Gold
rose on Monday on gains in U.S. equities and crude oil, but daily
volume looked set to be one of this year's lowest, reflecting bullion
investors' fickle sentiment toward further monetary easing by central
banks. The metal extended gains from last Friday, when data showing a
rising U.S. unemployment rate fed investor hopes for more aggressive
stimulus by the Federal Reserve. Short-covering also helped prices to
rebound from last week's weekly drop.
Trading volume in U.S. gold
futures, however, was poised to finish at less than half its 30-day
average, as some investors questioned whether central banks would come
through with more gold-supportive monetary action. Spot gold <XAU=> was up 0.6 percent at $1,612.56 an ounce by 3 p.m. EDT (1900 GMT). U.S. gold futures for December delivery <GCZ2> settled up $6.90 an ounce at $1,616.20. Volume was at around 77,000 lots by 3 p.m., versus its 30-day average of about 169,000 lots, preliminary Reuters data showed. A combination of gains in crude oil futures, the euro and U.S. equities also lifted gold prices.
Wall St closes at 3-month high on hopes for Europe
U.S.
stocks closed at three-month highs for the second day in a row on
Monday, extending last week's rally on the hope for more assistance for
the troubled euro zone. The S&P 500 rose to its highest point
since early May, but pared its gains going into the close. The benchmark
index also failed to breach 1,400, a level that could spur further
buying if convincingly broken. The S&P 500 hasn't closed above the
1,400 level since May 2.
Sentiment in Spanish and Italian bond
markets - the forefront of the three-year debt crisis - improved, with
two-year Spanish yields falling to 3.42 percent on Monday, less than
half of a late July high of over 7 percent. European Central Bank
President Mario Draghi has said the ECB may buy short-dated bonds to
lower borrowing costs to help Europe, which has been mired in a debt
disaster. European shares closed at four-month highs.
Wall Street
rallied on Friday with the S&P 500 marking its fourth straight week
of gains on a strong U.S. jobs report and renewed hope that European
authorities would act to contain the euro zone's debt crisis through ECB
purchases of Italian and Spanish bonds. The Dow Jones industrial
average <.DJI> rose 21.34 points, or 0.16 percent, to 13,117.51 at
the close. The Standard & Poor's 500 Index <.SPX> gained 3.24
points, or 0.23 percent, to 1,394.23. The Nasdaq Composite Index
<.IXIC> advanced 22.01 points, or 0.74 percent, to end at
2,989.91.
Euro extends prior session's gains on ECB optimism
The
euro edged higher against the dollar on Monday, extending the previous
session's gains on hopes the European Central Bank will take action to
lower borrowing costs for Spain and Italy. With little news to drive
markets, investors continued to focus on comments from ECB President
Mario Draghi last week, when he said the bank will draw up plans for
bond buying in the coming weeks. Gains in the equity market sparked
by Friday's data showing surprisingly strong U.S. jobs growth in July
also boosted the euro, prompting investors to pare hefty bets against
the currency.
The euro <EUR=> last traded 0.1 percent higher
at $1.2400, below a one-month peak of $1.2443 hit in Asian trade. Gains
in the euro over the last two sessions totaled nearly 2 percent, its
best two-day showing since late October. Near-term resistance for
the euro was seen around $1.2478, the 61.8 percent retracement of its
drop from a mid-June peak to a two-year low of $1.2042 touched in late
July. The common currency was down 0.2 percent against the yen at
96.99 <EURJPY=>, having earlier risen to 97.79 yen, its strongest
since mid-July. The euro was also slightly lower against the Swiss franc
<EURCHF=> and 0.3 percent weaker against the Norwegian crown
<EURNOK=>.
Oil Rises With U.S. Equities as Germany Backs ECB Plan
Oil
advanced to a two-week high as U.S. stocks gained and as German
Chancellor Angela Merkel’s government backed the European Central
Bank’s bond-buying plan, adding to optimism that the region’s debt
crisis will ease. Prices climbed 0.9 percent after the Standard
& Poor’s 500 Index rose to a three-month high amid
better-than-forecast earnings. The euro strengthened against the dollar
after Merkel’s deputy spokesman, Georg Streiter, said the government
backed the ECB’s plan to help bring down borrowing costs in Spain and
Italy.
Oil for September delivery increased 80 cents to $92.20 a
barrel on the New York Mercantile Exchange, the highest settlement since
July 19. Prices have climbed 19 percent since June 28, when they closed
at the 2012 low of $77.69. Brent crude for September increased 61
cents, or 0.6 percent, to settle at $109.55 a barrel on the London-based
ICE Futures Europe exchange.
Source : Reuters
