Market Buzz: Panic cooling as week ends

Investors expect Russian stocks to bounce back slightly on Friday, with floors opening the day in the black.

Negative Flash PMI data from
China along with uncertainty about the US Federal Reserve’s
bond-buying program saw Russian stocks slump on Thursday: The MICEX
closed 3.56 percent lower at 1396.90 and the RTS fell 4.18 percent
to close at 1400.84.

Markets worldwide reacted sharply to negative news in China and
the US. Weak manufacturing data from China indicated that its
manufacturing sector may be contracting, meaning the world’s
second-largest economy may not be growing at as fast a pace as
predicted.

Japanese stocks suffered major losses on Tuesday: The Nikkei 225
saw its biggest one-day drop — 7.3 percent — since Japan was hit by
a devastating tsunami more than two years ago. Other major indices
in Asia fell as well, with Hong Kong’s Hang Seng shedding 2.5
percent and South Korea’s Kospi dropping 1.2 percent. Markets in
Australia, Thailand, Taiwan and Singapore also fell.

European markets also posted sharp losses on Thursday. The Stoxx
Europe 600 index slumped 2.1 percent to 303.99, the FTSE 100
dropped 2.1 percent, Germany’s benchmark DAX 30 — which has been
posting all-time highs recently — lost 2.5 percent, and the French
CAC-40 slid 2.7 percent.

On Friday, the Ifo Institute will publish a report on the
business climate in Germany. Revised data will also be released on
Germany’s first-quarter economic growth and the Gfk consumer
climate index. Also, the UK will release industry data on mortgage
approvals, an important indicator of demand in the housing
market.

Major US indices rebounded during the day Thursday, but still
closed slightly lower. The Dow Jones Industrial Average lost 0.08
percent to close at 15294.50, the S&P 500 slipped 0.29 percent
to close at 1650.52, and the Nasdaq Composite was down 0.11 percent
to close at 3459.42.

Concerns are mounting about whether the US Fed intends to pull
out of its $85-billion-a-month bond-buying program, which has been
largely responsible for the multi-year highs witnessed in global
markets in recent weeks.

Data released Thursday showed that the number of American who
filed for jobless claims last week dropped by 23,000 to 340,000,
slightly beating expectations. The US flash PMI index fell to 51.9
in May from 52.1 in April, its lowest reading since last October.
On Friday, the US will wrap up the week with an update on durable
goods orders, a key production indicator.

Asian stocks are seeing further losses on Friday after being
struck by unexpectedly weak Chinese manufacturing data and news
from the US Fed. Japan’s Nikkei is still vulnerable: After a
massive gain in the wake of yesterday’s session, it reversed later
in the day, falling 0.7 percent to 14,391.74. South Korea’s Kospi
rose 0.1 percent to 1,971.23, Hong Kong’s Hang Seng fell 0.5
percent to 22,553.60 and Australia’s S&P/ASX 200 lost 1.7
percent to 4,976. Benchmarks in the Philippines, Taiwan and New
Zealand also fell.

Oil is currently trading lower, with Brent down 0.09 percent to
$102.30 and WTI down 0.3 percent t0 $93.90.

This article originally appeared on: RT