Japan Olympic bid victory gives Nikkei stocks a boost

By Pan Pylas, AP and AFP

LONDON/HONG KONG–In Europe, the mood was fairly lackluster amid a dearth of economic news and ongoing uncertainty over a military strike on Syria. The FTSE 100 index of leading British shares was down 0.1 percent at 6,524 while Germany’s DAX fell the same rate to 8,271. The CAC-40 in France was 0.4-percent lower at 4,032.

U.S. stocks were poised for a flat opening, with Dow futures 0.1-percent lower and the broader S&P 500 futures unchanged.

As well as monitoring developments over Syria, particularly the return of Congress in the U.S., traders around the world will continue to monitor the U.S. economic releases to gauge whether the Federal Reserve will start to reduce its monetary stimulus this month. Last Friday’s mixed U.S. jobs data failed to clarify the picture of whether the Fed will begin the so-called “tapering” of its US$85 billion worth of monthly asset purchases.

Emerging markets — especially in emerging economies — were hammered last month as foreigners fled back to the West in expectations the Fed will start to cut back on its vast bond purchases by the end of the year. Asian markets rose Monday as strong Chinese trade data lifted hopes for the global economic outlook while Japanese stocks were boosted by improved growth figures and Tokyo’s successful bid to host the 2020 Olympics. Tokyo rose 2.48 percent, or 344.42 points, to 14,205.23. Japanese dealers bought into construction and real estate plays after Tokyo’s Olympics success, while there was also cheer for better-than expected gross domestic product data for the April-June quarter. Tokyo dealers were already in buying mood after the Olympics result when data was unveiled showing the Japanese economy grew 0.9 percent over the previous quarter in April-June, up from a preliminary reading of 0.6 percent. The Nikkei was also supported by a weaker yen as confidence in the global economy saw investors move into higher-risk assets looking for better returns. Sydney rose 0.71 percent, or 36.5 points, to 5,181.5 in the first session back after the conservative Liberal/National coalition won a weekend general election in Australia as widely expected. Shanghai soared 3.39 percent, or 72.53 points, to 2,212.52 and Hong Kong added 0.57 percent, or 129.43 points, to 22,750.65. Seoul closed 0.99 percent higher, adding 19.36 points to 1,974.67. Chinese data on Sunday showed exports jumped 7.2 percent year-on-year to US$190.6 billion last month, much better than the 6.0 percent expected by economists. It was also better than the 5.1 percent rise seen in July.