Asia-Pacific, US markets decline; Europe mostly higher

Asia-Pacific equities markets were lower on Wednesday after news that the service sector in the United States contracted in January. New data from the Institute for Supply Management showed their non-manufacturing index at 41.9 in January, down from 54.4 in December. Analysts had predicted a decline, but only to 53. India’s Sensex was down 2.81 percent to 18,139.49. In Australia, the Sydney Ordinaries fell 2.98 percent to 5,677.6 and the S&P/ASX200 was 3.17 percent lower to 5,609.4. The FTSE Straits Times Index dropped 3.5 percent to 2,931.97 in Singapore while the Hang Seng plummeted 5.4 percent, a decline of 1,339 points, to 23,469.46 in Hong Kong. Markets in China, Taiwan, and South Korea were all closed for holidays.

Tokyo’s markets followed the rest of the region lower. The Nikkei 225 was down 4.7 percent to 13,099.24 while the Topix index fell 4.21 percent to 1,298.41 and the Mothers market dropped 2.73 percent to 625.33. Food processors were lower after an alarm over tainted food put an end to a merger in the sector. The electronics sector and carmakers were also lower, while camera makers were mixed.

European markets advanced on the session. The FTSE Eurofirst 300 added 0.63 percnt to 1,322.66. The CAC-40 was up 0.83 to 4,816.43 in Paris, while the Dax was 1.22 percent higher to 6,847.51 in Frankfurt and Madrid’s IBEX gained 1.74 percent to 13,037.30. Banks were mixed, with some dropping on negative broker comment, while chipmakers were down on broker downgrades for some. Carmakers were mostly lower, but the travel and leisure sector saw gains and power generators were up on bids possibilities.

The markets were mixed in London, with the FTSE 100 adding 0.13 percent to 5,875.4 at the same time that the FTSE 250 dropped 0.51 percent to 9,904.5. Banks were lower, except for Northern Rock (LSE: NRK), which added almost 9 percent after one bidder which had dropped out of the process said it could return to the bidding under certain circumstances. The insurance and oil sectors were both mostly lower on the session, while the retail sector was mixed with more winners than losers.

Wall Street closed lower on the session after comments from Federal Reserve officials led to speculation that the current round of interest rate cuts could be over. The Dow Jones Industrial Average was down 0.53 percent to 12,200.1 and the Nasdaq Composite was 1.33 percent lower to 2,278.75 while the S&P 500 dropped 0.76 percent to 1,326.45. The retail sector saw declines as a report from one department store chain that showed a dip in sales in January caused worries that other retailers would also report weak sales. Futures exchanges declined on a Department of Justice proposal that could stop a proposed merger. On the other hand, the media sector saw gains on good corporate news that led investors to believe that some sectors outside of financials could weather the current slowdown.

Story link: Asia-Pacific, US markets decline; Europe mostly higher