- Category: Economic
- Published Tuesday, January 5, 2016
- CTV News
SEOUL, South Korea -- Global stock markets were weaker Tuesday even as China's benchmark stabilized a day after plunging nearly 7 per cent.
European stocks opened mostly lower. France's CAC 40 fell 0.3 per cent to 4,507.35 and Germany's DAX dropped 0.4 per cent to 10,244.76. Britain's FTSE 100 added 0.2 per cent to 6,105.09. Futures suggested Wall Street was set to extend losses. Dow futures fell 0.5 per cent and S&P 500 futures slipped 0.5 per cent.
Earlier in Asia, China's Shanghai Composite Index finished down 0.3 per cent at 3,287.71 after wavering between gains and losses. It slumped 6.9 per cent on Monday, the first trading day of 2016. Japan's Nikkei 225 was down 0.4 per cent at 18,374.00 and Australia's S&P/ASX 200 slipped 1.6 per cent to 5,184.40.
South Korea's Kospi was up 0.6 per cent to 1,930.53 while Hong Kong's Hang Seng was down 0.7 per cent to 21,188.72. Markets in Southeast Asia were mixed.
Global stocks started the new year on a grim note as poor manufacturing reports from China and the U.S. triggered fears about waning growth around the world. The steep fall in Chinese markets on Monday prompted authorities to halt trading by using a new "circuit-breaker" mechanism for the first time.
"The moves seen in Chinese stock markets are quite concerning," said Angus Nicholson, market analyst at IG in Melbourne, Australia. Technical indicators "point to a likely renewed sell-off and a revisit of the late-August lows," he said in a market commentary.
Tensions in the Middle East also unnerved investors. Saudi Arabia severed diplomatic relations with Iran over the weekend in a dispute over the Saudis' execution of a Shiite cleric. Concerns about a potential threat to world oil supply caused a spike higher in oil prices.
Benchmark U.S. crude was up 4 cents to $36.80 per barrel in electronic trading on the New York Mercantile Exchange. The contract fell 28 cents to close at $36.76 a barrel on Monday. Brent Crude, the international standard, lost 5 cents at $37.18 per barrel in London.
In currencies, the dollar slipped to 119.09 yen from 119.43 yen on Monday. The euro weakened to $1.0775 from $1.0826.