Asia stocks drop on fresh Europe woes; Nikkei dips 0.58%
Published Jan 04, 2012 09:46PM ET
During morning Asian trading Thursday, Hong Kong's Hang Seng Index was up 0.16%, Australia's S&P/ASX200 was down 1.23%, while Japan’s Nikkei 225 Index was down 0.58%.
In Europe, reports emerged that banks are stashing more and more money in overnight deposit accounts at their central bank instead of lending it out, which suggests the continent's credit crunch remains firmly in place.
Also in Europe, Italy's UniCredit financial institution placed a EUR7.5 billion rights issue at a steep discount, reflecting concerns that other banks will have a tough time raising capital.
"The focus this year is whether Europe's debt problems will settle and when those problems will begin to impact the United States. There are no other themes this year except Europe," said Yutaka Miura, senior technical analyst at Mizuho Securities, according to Reuters.
"Market participants are watching how much longer the yen will continue to rise against the euro and the dollar."
A strong yen and weak demand from Europe threatens Japan's crucial export sector.
News out of Europe erased optimism from manufacturing output figures in the U.S. and China earlier this week that had beat forecasts and suggested the world's top economies may be recovering at a faster clip.
Hong Kong's leading gainers included China Mobile, up 1.56%, Sinopec, up 1.30%, and CNOOC, up 1.19%.
In Australia, the top losers included Campbell Bros, down 4.07%, Carsales.com, down 3.61%, and Bluescope Steel, down 3.53%.
European stock futures indicated losses.
France's CAC 40 futures pointed to a loss of 0.07%, while Germany ’s DAX 30 futures signaled a loss of 0.03%. Meanwhile, in the U.K., the FTSE 100 futures indicated a decline of 0.09%.
Dow Jones Industrial Average futures were down 0.05% while the broader S&P 500 futures were down 0.04%.
No major data was expected out of Asia for the rest of the Thursday session but in the U.S., the ADP National Employment Report was due out later as were weekly jobless claims numbers.
The U.S. will also release gasoline and crude inventories, which may shed some light on overall demand for energy used to fuel economic growth.
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Written By: Investing.com
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