Asia Closed Mixed And Europe Trading Lower After MPC Votes

Asian markets closed mixed today by breaking the recent winning streak. The Shanghai index plunged after the Central Bank of China confirmed today that they are not going to initiate any quantitative easing measures this year but still pledging to other major reform in the country which will support their GDP target. In the absence of the quantitative easing it could be difficult for Chinese officials to maintain their GDP target of 7.5% for 2013.

Stocks surged in Japan despite the reluctance of the Central Bank to add any further stimulus package. Many of these gains were on the expense of the Yen. The Hang Seng Index was the best performing index during the session which closed with a gain of 0.28%. The index is up nearly 3.33% for the past five days. The Nikkei index was the second best performer and closed with a gain of 0.11%. However, the Shanghai index closed in a deep red territory and closed with a loss of -1.0%.

Coal miners were among of the biggest gainers in Hong Kong and shares of China Shenhua Energy Co. and China Coal energy both surged nearly by 5.3% and 3% respectively. Exporters gained once again in Tokyo on the back of a weaker yen and shares of Mitsubishi Corp gained nearly 11.1%.

European stock markets are trading lower during the early hours of trading. The MPC voting has pushed the FTSE 100 deep down in the red territory with a disappointing result of 0-0-9. Mark Carney who is the new governor of the bank of the England failed to impress the markets for another round of quantitative easing.

Mr. Carney did vote for more aggressive quantitative easing during the last meeting which was backed up by two more votes which were Paul Fisher and David Miles. However, in today’s voting the two doves Paul Fisher and David Miles changed their views on further quantitative easing and voted against this. This was clearly a blow for the market which took a nose dive on this news by pushing the FTSE 100 in a deep red territory. However, a bad news for the FTSE 100 was the good news for GBP which gained across a basket of currencies.

The IBEX Index is the worst performing index during the session which is trading down with a loss of -0.87%. The index is down nearly -3.57% for the past five days. The CAC 40 index is the second worst performer and is also trading down with a loss of 0.45%. The FTSE 100 and the FTSE MIB are trading lower too with a loss of -0.36%, and -0.46% respectively.

DISCLOSURE & DISCLAIMER: The above is for informational purposes only and NOT to be construed as specific trading advice. responsibility for trade decisions is solely with the reader.

by Naeem Aslam