World stocks rise as solid US growth offsets China’s credit worries

Youkyung Lee, The Associated Press 0

SEOUL, South Korea – World stocks traded higher on Monday as a report that the U.S. economy expanded more than expected in the third quarter outweighed concerns about a credit crunch in China.

Hong Kong’s Hang Seng was up 0.5 per cent to 22,921.56, while China’s Shanghai Composite added 0.24 per cent to 2,089.71. South Korea’s KOSPI rose 0.7 per cent to 1,996.89.

Elsewhere, stocks in Taiwan, Singapore and New Zealand advanced. Tokyo stock markets were closed for a holiday.

In Europe, France’s CAC 40 gained 0.1 per cent to 4,198.88 and Germany’s DAX rose 0.4 per cent to 9,435.45.

U.S. stocks were set for another day of gain. Futures for the Dow Jones industrial average and broader S&P were up 0.3 per cent.

Over the weekend, government figures showed that the U.S. economy grew 4.1 per cent in the third quarter over a year earlier, compared with the previous estimate of 3.6 per cent. The report strengthened the view that the world’s largest economy will lead the developed market’s growth next year, which many Asian exporters rely on for sales.

U.S. stocks closed at record highs after the report that the U.S. economy grew at the fastest clip since the late 2011 and much of the growth came from stronger consumer spending.

Investors will be looking at China after last week’s report that the country injected $50 billion into the markets to ease a cash squeeze. Last Thursday, the People’s Bank of China injected liquidity after the interbank market showed stress, but concerns over a repeat of the summer’s credit crunch still weighed on some stock markets last week.

Chinese central bank’s action came in the wake of the U.S. Fed’s decision to cut back its $85 billion bond purchase programs next month, which could weigh on assets in emerging markets.

Among individual stocks, China Mobile Ltd. added 0.8 per cent in Hong Kong boosted by its long-anticipated deal to bring the iPhone to the world’s biggest phone company.

In energy markets, benchmark crude for January delivery was down 35 cents to $98.97 a barrel in electronic trading on the New York Mercantile Exchange. The contract added 55 cents to $99.32 on Friday.

In the currency markets, the euro gained to $1.3678 from $1.3674. The dollar gained to 103.96 yen from 103.99 yen.

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