Nikkei Surged Nearly 5%, Europe Trading Lower

Asian markets started the week on a positive note, and closed strongly up on the first day of trading. The Nikkei 225 made strongest recovery on Monday, gaining almost 4.94%. The index was the best performing index during the Asian session, as other markets digested a set of poor economic data from China. The Hang Seng index was the second best performer and closed with a gain of 0.18%.

The current account surplus for the Japanese economy came much better than anticipated for the month of April, which lifted the stock market up and ended its three day losing streak. The shares for the exporters climbed on the back of a weaker yen. Toyota Motor Corp and Bridgestone Corp both gained 7.1% and 5.9% respectively.

However, the Chinese economic data painted an uninspiring picture when a 1% increase in exports for the month of May was offset by a 0.3% decline in imports. Due to a public holiday in mainland China, markets remained quiet while the Hang Seng index managed to close in a positive territory.

The European markets are struggling to hang on to last week’s gain despite a strong finish in Tokyo last night. The DAX is the best performing index, and is up nearly 0.69%. However, the IBEX 35, FTSE 100 and CAC 40 are all trading lower with a loss of -0.13%, -0.08% and -0.14% respectively.

The Mining firms are under strong pressure due to poor economic data released in China. The mining sector has mostly been sensitive to growth indication as China is the one of the major consumers of natural resources.

The shares of the Rio Tinto PLC, Anglo American PLC are all trading lower with a loss of -1.7% and -1.7%. BHP Billiton PLC is also trading lower with a loss of -1.3%. Shares of Nordea Bank AB came under pressure, and are trading lower with a minor loss of -0.2% after Goldman Sachs cut its rating from Buy to Neutral.

DISCLOSURE & DISCLAIMER:
The above is for informational purposes only and NOT to be construed as specific trading advice. responsibility for trade decisions is solely with the reader.

by Naeem Aslam