Data cools China stocks, other markets overcome bond jitters

AP and AFP

BEIJING/HONG KONG–Chinese stocks sank Wednesday after weak April retail spending but other major global benchmarks rose, overcoming jitters caused by a bond sell-off.

European markets rebounded from the previous day’s losses. France’s CAC-40 gained 1.2 percent to 5,036.43 points and Germany’s DAX added 0.7 percent to 11,553.70. Britain’s FTSE 100 rose 0.6 percent to 6,977.41. Wall Street also looked set to recover. The future for the Dow Jones Industrial Average was up 0.4 percent at 18,095.00. Standard & Poor’s 500 futures rose 0.4 percent to 2,103.80. On Tuesday, the Dow sank 0.2 percent after falling nearly six times that far during the day. The S&P lost 0.3 percent and the Nasdaq composite slid 0.4 percent.

A spike in long-term interest rates Tuesday rattled investors who sold U.S. stocks. Traders have been selling government bonds in recent weeks. That accelerated Tuesday, bringing down prices and driving up the benchmark U.S. bond yield to the highest level since late November. In the United States, the yield on the 10-year Treasury note surged as high as 2.36 percent. Weakness in bond prices pushes up the cost of borrowing, including mortgages and other loans, which can drag on the economy.

Greece made a 757-million-euro (US$844 million) debt payment to the International Monetary Fund but owes more in coming weeks. Athens is under pressure from its creditors to liberalize labor markets further and reduce state funding for pensions. The radical left Syriza-led government, elected in January, is seeking the release of stalled rescue loan money as state coffers run low. Greece has taken as ��many steps as possible�� toward reaching an agreement with bailout lenders, Prime Minister Alexis Tsipras said Tuesday. ��It is now the turn of our (European) partners to take the steps needed.��

Tokyo rose 0.71 percent, or 139.88 points, to 19,764.72, Sydney jumped 0.71 percent, or 40.4 points, to 5,715.1 and Seoul tacked on 0.83 percent, or 17.39 points, to 2,114.16. However, Shanghai ended 0.58 percent lower, giving up 25.46 points to 4,375.76 while Hong Kong fell 0.58 percent, or 157.90 points to 27,249.28. Chinese markets turned lower in the afternoon after the National Bureau of Statistics announced figures for retail sales, industrial output and fixed asset investment, which all missed expectations. The figures are the latest to show ongoing weakness in the world’s number two economy �X following soft trade and inflation data last week �X and come days after the central bank at the weekend cut interest rates again for the third time since November. Shanghai’s stock market has almost doubled in the past year on hopes for a slew of easing measures to kick-start growth, while Hong Kong has also taken off over the past six weeks as mainland investors pour south. Gold fetched US$1,194.41 from US$1,184.73 late Tuesday. In other markets: