Japan's Nikkei underperforms amid mounting political risks

AP News
Posted: Feb 09, 2017 7:59 AM
Japan's Nikkei underperforms amid mounting political risks

LONDON (AP) — Japan's main stock index underperformed Thursday ahead of meetings between Prime Minister Shinzo Abe and President Donald Trump. Other worries, such as renewed concerns over Greece, kept a lid on markets elsewhere.

KEEPING SCORE: In Europe, Britain's FTSE 100 inched 0.2 percent higher to 7,206 while Germany's DAX rose 0.6 percent to 11,618. The CAC 40 of France climbed 0.4 percent to 4,785. Wall Street was headed for a solid opening, with both Dow and S&P futures up 0.2 percent.

ABE-TRUMP SUMMIT: Trump's complaints over trade and currency rates worry many in Japan and Abe hopes to sell him on a job creation and investment package when they meet Friday. Japan's Nikkei 225 stock index lost 0.5 percent to 18,907.67 in contrast to many other regional benchmarks.

POLITICAL RISKS: As well as uncertainty over Trump's policy actions in the days and weeks ahead, investors have a series of political risks to contend with, including upcoming elections in the Netherlands, France and Germany and renewed worries over Greece and its future in the euro.

ANALYST TAKE: "The bullish sentiment that has dominated financial markets since Trump's victory seems to be wavering, as the lack of detail over any fiscal stimulus, coupled with a focus on his travel ban, takes precedence," said Joshua Mahoney, market analyst at IG. "The impending political headwinds from Holland, France and Germany, alongside the ever present Greece, means there is an increasingly cloudy outlook ahead for traders, as reflected by recent market hesitancy."

ASIA'S DAY: Japan's Nikkei 225 stock index lost 0.5 percent to 18,907.67 but most other benchmarks were higher. Hong Kong's Hang Seng index gained 0.2 percent to 23,525.14 and the Kospi in South Korea was almost flat at 2,065.88. The Shanghai Composite index climbed 0.5 percent to 3,183.18 and Australia's S&P ASX/200 rose 0.2 percent 5,664.60, while shares in Southeast Asia were mostly higher.

ENERGY: Benchmark U.S. crude gained 41 cents to $52.753 a barrel in electronic trading on the New York Mercantile Exchange, while Brent crude, the benchmark for international oil prices, added 40 cents to $55.52 a barrel.

CURRENCIES: The euro fell 0.1 percent to $1.065 while the dollar rose 0.4 percent to 112.32 yen.