BEIJING – Chinese stocks tumbled on weak trade data but other major markets rose Monday after U.S. jobs data fueled speculation the Federal Reserve will put off another interest rate hike.
In early trading, Germany’s DAX advanced 0.9 percent to 9,953.71 points and France’s CAC-40 gained 0.5 percent to 4,322.66. London’s FTSE 100 rose 0.4 percent to 6,129.46. On Friday, the CAC-40 lost 1.6 percent, the DAX shed 1 percent the FTSE 100 declined 0.9 percent.
Wall Street looked set for gains, with both Dow and S&P 500 up 0.3 percent.
Chinese trade shrank in a sign of weak global and domestic demand despite government stimulus efforts. Exports contracted by 1.8 percent in April from a year earlier and imports plunged 10.9 percent. Exports so far this year are down 7.7 percent, though that is an improvement over March’s 9.6 percent year-to-date decline.
Disappointing jobs data fueled speculation the Federal Reserve might keep interest rates low for another year. The economy added 160,000 jobs in April – less than the forecast of 200,000. But wage growth accelerated to 0.3 percent over the previous month compared with March’s 0.2 percent rise. Unemployment held steady at 5 percent.
“This latest mixed data has further diminished the chances of the rate hike in the Fed’s meeting next month,” Alex Wijaya of CMC Markets said in a report.
The government said China’s foreign currency reserves, the world’s biggest, rose $6.4 billion in April to just over $3.2 trillion, the second straight monthly increase. That might help to ease investor fears of a capital outflow that might limit the central bank’s options for countering the slowdown. “We believe the authorities can live with capital outflows as long as foreign reserves stay above $3 trillion, which implies monthly declines of around $20 billion,” ING said in a report.
Investors were watching to see if voters side with the front runner in elections Monday, a foul-mouthed mayor who has pledged to wipe out corruption. Rodrigo Duterte’s blunt comments resonate with some voters but have sparked alarm about electing someone with no national political experience and a tendency to make inflammatory remarks. If Duterte wins, Philippine markets “may initially sell off on uncertainty around economic and foreign policy,” Mizuho Bank said in a report.
The Shanghai Composite Index fell 2.8 percent to 2,832.11 points and Seoul’s Kospi was off 0.4 percent at 1,967.81. Tokyo’s Nikkei 225 advanced 0.7 percent to 16,216.03 and India’s Sensex was up 1.4 percent at 25,585.71. Sydney’s S&P-ASX 200 rose 0.5 percent and Singapore also advanced. Benchmarks in Thailand, New Zealand and Indonesia retreated.
Benchmark U.S. crude gained $1.03 cents to $45.69 per barrel in electronic trading on the New York Mercantile Exchange. The contract added 44 cents on Friday to close at $44.66. Brent crude, used to price international oils, advanced 82 cents to $46.19 in London. It added 36 cents on Friday to $45.37.
The dollar advanced to 107.89 yen from Friday’s 107.11 yen. The euro fell to $1.1402 from $1.1410.