Global Shares Lower on Monday 07/22 05:53
Global shares were mostly lower Monday, tracking losses on Wall Street,
though a newly launched technology stocks market in Shanghai soared with its
TOKYO (AP) -- Global shares were mostly lower Monday, tracking losses on
Wall Street, though a newly launched technology stocks market in Shanghai
soared with its trading debut.
France's CAC 40 edged 0.2% higher to 5,562.84, while Germany's DAX also
gained 0.2% to 12,291.87. Britain's FTSE 100 gained 0.5% to 7,548.88. U.S.
shares were set to drift higher with Dow futures adding 0.2% to 27,171. S&P 500
futures picked up 0.3% to 2,984.70.
Prices of many of the 25 tech companies listed on the Shanghai Stock
Exchange's STAR Market more than doubled, with one company, Anji
Microelectronics Technology (Shanghai) Co., Ltd., logging a 400% advance.
Regulators have approved 25 companies in information technology and other
fields for the STAR Market. The market, modeled on the U.S.-based NASDAQ,
reflects the ruling Communist Party's desire to channel private capital into
its development plans. It gives small Chinese investors a chance to buy into
tech industries that until now have turned to Wall Street to sell shares.
Trading kicked off with fanfare early Monday with the city's Communist Party
secretary, Li Qiang, and the chairman of China Securities Regulatory
Commission, Yi Huiman, joining to bang a ceremonial gong.
Elsewhere in Asia the mood was more subdued.
Japan's Nikkei 225 slipped 0.2% to finish at 21,416.79. Australia's S&P/ASX
200 fell 0.1% to 6,691.20. South Korea's Kospi edged less than 0.1% lower to
2,093.34. Hong Kong's Hang Seng dipped 1.4% to 28,371.26, while the Shanghai
Composite index shed 1.3% to 2,886.97. Taiwan's index rose while Southeast
Asian benchmarks fell.
News that the Chinese government has decided to allow full foreign ownership
of securities, fund management and futures companies next year, one year
earlier than previously planned, did not help lift shares in Shanghai.
A weekend Cabinet announcement also promised to increase the limit on
foreign ownership of insurance companies from 25% and to open pension and asset
management to foreign competitors. It gave no timetable or other details.
Washington and other trading partners complain Beijing is dragging its feet
on promises to open its financial industries after it joined the World Trade
Organization in 2001.
Business groups have welcomed industry-opening steps promised over the past
18 months but say foreign competitors need to see licensing and other
restrictions before they can know whether operations might be profitable.
On Friday, U.S. stocks retreated further from their records to cap the
weakest week for the S&P 500 since May as sentiment darkened after Iran said it
seized a British oil tanker in the latest escalation of tensions between Tehran
and the West.
Momentum for U.S. stocks has slowed since early June, when they began
soaring on expectations that the Federal Reserve will cut interest rates for
the first time in a decade to ensure the U.S. economy doesn't succumb to
weaknesses abroad. The Fed's next meeting is scheduled for the end of this
"With the markets wholly captivated by the looser the policy, the better the
risk opportunities, investors could remain singularly focused on the Federal
Reserve, and the European Central Bank policy decision and communications as
global equity markets continue to have their ups and down based on the
perceived degree of accommodative central bank policy," Stephen Innes of
Vanguard Markets said in a commentary.
ENERGY: Benchmark U.S. crude oil added $1.12 to $56.88 a barrel in
electronic trading on the New York Mercantile Exchange. It gained 34 cents to
$55.76 on Friday. Brent crude, the international standard, rose $1.44 to $63.91
CURRENCIES: The dollar rose to 107.83 Japanese yen from 107.74 yen on
Friday. The euro weakened to $1.1220 from $1.1221.