World markets gain in face of US superstorm

AP News
Posted: Oct 31, 2012 5:54 AM
World markets gain in face of US superstorm

BEIJING (AP) — World markets rose and Wall Street prepared to get back to business Wednesday after a mammoth storm pummeled the U.S. East Coast, forcing forced the closure of the New York Stock Exchange.

Oil rose above $86 a barrel as investors waited for U.S. employment data that are expected to show little improvement.

In Tokyo, the regional heavyweight, the benchmark Nikkei 225 was up 1 percent to close at 8,928.29. Hong Kong added 1 percent to 21,641.82 while South Korea's Kospi added 0.7 percent to 1,912.06.

In Europe, Germany's DAX rose 0.8 percent to 7,340.1 while France's CAC 40 added 0.6 percent to 3,480.84. Britain's FTSE 100 rose less than 0.1 percent to 5,854.54.

Global markets stayed calm despite Hurricane Sandy's disruption of U.S. trading. Losses Monday in Europe were recovered Tuesday.

"While the economic and social cost of the Superstorm will be counted over coming days, markets in general appear to have brushed off their worst fears," said Credit Agricole CIB economist Dariusz Kowalczyk in a report.

The New York Stock Exchange's decision to close Tuesday marks the first time weather has stopped trading for two straight days since 1888. Experts expect storm damage of about $20 billion, about half of that insured.

The NYSE said it would reopen Wednesday using backup generators because power is out in much of downtown Manhattan.

Wall Street experts had feared another delay might lead to a dangerous backlog of customer orders to buy and sell stock. It could have dealt a blow to the image of U.S. markets, already hurt by investor distrust, sudden market swings and a series of trading glitches, including the botched IPO of Facebook.

Elsewhere, Sydney's S&P ASX 200 gained 0.7 percent to 4,517. Taiwan's Taiex was off 0.2 percent at 7,166.05. India's Sensex rose 0.4 percent to 18,514.0.

Futures for the Dow Jones industrial average rose 0.5 percent to 13,115 while the Standard & Poor's 500 futures rose by 0.7 percent to 1,417.

In the United States, investors were looking ahead to Friday's Labor Department release of jobs data that are expected to show little change in payrolls.

"The trend has gone absolutely nowhere since April. Markets expect no change this week," DBS Bank Ltd. in Singapore said in a market commentary.

Japan's central bank lowered its economic outlook on Tuesday, saying it expected growth of 1.6 percent in the year ending in March, down from previous forecasts of 2 percent.

"The possibility is increasing that the economy is heading towards a technical recession," said DBS.

Japan's economy has been hobbled by weakness in its export sector, which has been hit hard by a slowdown in demand from recession-mired Europe and a strong yen, which makes Japanese products more expensive abroad.

Investors also were watching China, where a once-a-decade handover of power to younger Communist Party leaders is due to start at a party congress next week.

The euro rose to $1.3003 from $1.2962 late Tuesday in New York. The dollar rose slightly to 79.75 yen from 79.60 yen.

Benchmark crude oil for December delivery rose 26 cents to $85.94 per barrel in electronic trading on the New York Mercantile Exchange. The contract rose 14 cents on Tuesday to $85.68.