A man wipes the sweat from his head while he looks at an electronic stock board of a securities firm in Tokyo, yesterday
World stocks were mostly lower yesterday as the euro’s gains sent European shares lower and investors waited for damage assessments from Tropical Storm Harvey, which battered Texas’ refinery-rich Gulf Coast and sent gasoline futures spiking.
KEEPING SCORE: European shares sank in early trading. France’s CAC 40 lost 0.2 percent to 5,094.29 and Germany’s DAX shed 0.5 percent to 12,109.07. Wall Street was poised to open lower. Dow futures lost 0.2 percent to 21,776.00 and broader S&P 500 futures dipped 0.1 percent to 2,439.90. British markets were closed for a holiday.
STORMY WEATHER: Incessant rain from Harvey, which slammed ashore as a strong hurricane late last week, has submerged much of Houston and shut down Texas’s oil and gas industry. It’s unclear how bad the damage is to facilities along the state’s Gulf Coast but preliminary signs indicate widespread losses, which will have big implications for the U.S. economy and oil and gas prices. Gasoline futures trimmed earlier gains but were still at their highest level this year, up 4.4 percent to USD1.74 a gallon, while crude futures were mixed. S&P Global analysts said about 2.2 million barrels per day of refining capacity was down or being brought down by Sunday.
NO SURPRISES: The gatherings of central bankers in Jackson Hole, Wyoming, was last week’s big economic event but investors found no surprises in speeches by Fed chief Janet Yellen and European Central Bank chief Mario Draghi. There was nothing to change investors’ expectations that the Fed will continue to gradually raise interest rates and prepare to trim its $4.5 billion balance sheet. Investors were now looking ahead to economic data releases due later this week, including China’s purchasing managers’ index on Thursday and U.S jobs data on Friday.
CURRENCIES: The euro was at $1.1936, off earlier highs that took the currency to its strongest level in more than two and a half years. The currency continued to rise after jumping Friday during Draghi’s speech. He didn’t address the financial health of the eurozone, but investors took that as a sign of confidence in the continent’s economy. A stronger euro makes European exports more costly for foreign buyers. The dollar fell to 109.19 Japanese yen from 109.36 yen on Friday.
MARKET VIEW: “All of this is bad news for European stocks, particularly the export-heavy DAX, and we could see further moderation for European stocks at the start of this week,” said Kathleen Brooks, research director at City Index.
ASIA’S DAY: Japan’s benchmark Nikkei 225 index ended practically unchanged at 19,449.90 and South Korea’s Kospi lost 0.4 percent to 2,370.30. Hong Kong’s Hang Seng rose less than 0.1 percent to 27,863.29 and the Shanghai Composite in mainland China added 0.9 percent to 3,362.65. Australia’s S&P/ASX 200 shed 0.6 percent to 5,709.90. Taiwan’s benchmark rose and indexes in Southeast Asia were mixed.
ENERGY: Benchmark U.S. crude fell 42 cents to $47.45 a barrel in electronic trading on the New York Mercantile Exchange. The contract added 44 cents to settle at $47.87 per barrel on Friday. Brent crude, the international standard, rose 3 cents to $52.01 per barrel. Kelvin Chan, Hong Kong
