Wednesday 6 April 2011

World stock markets mixed as Japan makes progress in battle to contain nuclear crisis

By Pamela Sampson, The Associated Press
BANGKOK - World markets struggled to find direction Wednesday, with uncertainty over Japan's industrial production capabilities overshadowing its progress in containing a toxic radiation leak at a nuclear power complex.

Oil prices hovered above $108 a barrel in Asia after a U.S. crude supply report gave mixed signals about demand. In currencies, the dollar rose against the yen but slipped against the euro.
European shares were mixed in early trading. Britain's FTSE 100 was 0.2 per cent higher to 6,016.95. Germany's DAX fell 0.1 per cent to 7,169.26 and France's CAC-40 was down 0.6 per cent to 4,018.45. Wall Street was headed higher, however. Dow Jones industrial futures gained 22 points to 12,349 and S&P 500 futures rose 2.8 points to 1,329.50.
Japan's battered Nikkei 225 closed down 0.3 per cent to 9,584.37, with only a sprinkling of major exporters clawing back ground lost after a March 11 earthquake and tsunami pummeled the country's industrial northeast. Yamaha Motor Corp. jumped 2.6 per cent, while Canon Inc. was up 0.6 per cent.
Toyota Motor Corp. announced it would resume limited production at its plant in Kanagawa, west of Tokyo, on Monday. Toyota shares closed 0.2 per cent higher despite a statement from Moody's Investors Service saying it may downgrade Toyota's credit rating due to the financial fallout from suspended car production.
A rare bit of relief for quake-battered Japan came earlier Wednesday, when workers at Japan's tsunami-damaged Fukushima Dai-Ichi nuclear complex finally stemmed a tide of radiation that was pouring into the Pacific Ocean. But highly contaminated water continues to pool around the complex.
Tokyo Electric Power Co., known as TEPCO, lost 6.9 per cent, a day after blowing past its all-time low set in 1951. TEPCO, which owns the complex, has lost a staggering 80 per cent since the crisis began as concerns mount over possible damage claims.
Hong Kong's Hang Seng gained 0.6 per cent to 24,285.05 as investors scooped up retail shares in clothing and jewelry, anticipating a spending splurge during Easter. Oriental Watch Co. Ltd. soared 8.1 per cent.
Mainland Chinese shares were mixed at the close of trading. The Shanghai Composite Index was up 1.1 per cent to 3,001.36, while the smaller Shenzhen Composite Index drooped 0.3 per cent to 1,262.46.
South Korea's Kospi index fell 0.2 per cent to 2,126.71. Australia's S&P/ASX 200 gained 0.3 per cent to 4,912.52. Benchmarks in Indonesia, Singapore and Taiwan also gained.
Late Tuesday, China's central bank raised key interest rates for the fourth time since October in an effort to dampen high inflation. The series of rate hikes reflects concerns about overheating and excess liquidity in the Chinese economy that are driving up prices, especially of food.
But the action did little to shake investor confidence.
"I don't think investors paid too much attention to this sort of long-awaited interest rate hike in China," said Kwong Man Bun, chief operating officer at KGI Securities in Hong Kong. "It seems investors are getting less sensitive to the news in Japan."
The Bank of Japan started a two-day policy meeting Wednesday and investors will be looking to see if it enacts any further easing measures. The central bank has pumped billions of yen into the economy as it tries to keep liquidity flowing through the system in the wake of the disasters.
It has also received international support to stem the export-sapping appreciation of the yen. The dollar rose to 85.03 yen from 84.88 yen late Tuesday in New York. The euro rose to $1.4295 from $1.4245.
Wall Street's stock indexes were left little changed Tuesday after minutes from the most recent meeting of the Federal Reserve's policy committee showed few signs that the central bank plans to expand its stimulus program.
The Dow Jones industrial average fell less than 0.1 per cent to 12,393.90. The S&P 500 index was essentially unchanged at 1,332.63. The Nasdaq composite gained 0.1 per cent to 2,791.19.
Benchmark crude for May delivery was up 15 cents at $108.49 a barrel in electronic trading on the New York Mercantile Exchange. The contract fell 13 cents to settle at $108.34 on Tuesday.

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