Asian stocks fall, China rises on stimulus hopes

AP News
Posted: Dec 15, 2014 11:51 PM
Asian stocks fall, China rises on stimulus hopes

HONG KONG (AP) — Asian stocks slid Tuesday as further weakness in oil prices and the slumping Russian ruble helped extend the global market rout. China's benchmark rose after poor factory data fueled hopes of more stimulus.

KEEPING SCORE: Japan's benchmark Nikkei 225 index tumbled 1.9 percent to 16,774.92 and South Korea's Kospi lost 0.4 percent to 1,912.04. Hong Kong's Hang Seng fell 1.2 percent to 22,757.92 while in mainland China the Shanghai Composite Index gained 0.7 percent to 2,975.37. Australia's S&P/ASX 200 shed 0.5 percent to 5,158.10.

CHINA FACTORIES: Shanghai shares gained after a preliminary HSBC report on manufacturing showed a contraction for the first time in seven months. While the numbers underscored the persistent weakness in the world's second biggest economy, they also fuelled investor hopes of more stimulus after a surprise interest rate cut last month.

ANALYST TAKE: "We expect (Chinese) policymakers to respond to the continued weakness with further rate cuts and liquidity injections," said Julian Evans-Pritchard, China economist at Capital Economics.

ENERGY: Oil prices are at five-year lows as supply booms while energy demand wanes. Benchmark U.S. crude was down 22 cents to $55.69 a barrel in electronic trading on the New York Mercantile Exchange. The contract fell $1.90, or 3.3 percent, to close at $55.91 on Monday. Brent crude, a benchmark for international oils used by many U.S. refineries, fell 79 cents to close at $61.06 in London.

CURRENCIES: The ruble stabilized after the Russian central bank dramatically hiked interest rates in a bid to stem the currency's decline. The Russian currency was trading at 65.49 to the dollar after sinking 13 percent on Monday. The ruble has lost about half its value since the start of the year because of the collapse of oil prices and Western sanctions over its actions in Ukraine. In other currency trading, the dollar weakened to 117.43 yen from 117.82 in late trading Thursday. The euro strengthened to $1.2457 from $1.2443.

WALL STREET: The Dow Jones industrial average fell 0.6 percent to 17,180.84 on Monday. The Standard & Poor's 500 fell 0.6 percent to 1,989.63. The Nasdaq composite lost 1 percent to 4,605.16.