Asia stocks fall, Europe edges up as investors brace for weak US economic data, Fed statement
World stock markets were uneven Wednesday as investors waited for a U.S. growth report that is expected to provide the latest sign of slowing momentum in the world's biggest economy and a Fed policy statement.
KEEPING SCORE: France's CAC-40 rose 0.3 percent to 5,190.98 and Germany's DAX added 0.4 percent to 11,864.69. Britain's FTSE 100 crept up 0.2 percent to 7,048.12. U.S. stocks were poised to open lower, with Dow futures down 0.1 percent to 18,045.00. Broader S&P 500 futures lost 0.1 percent to 2,110.30.
US ECONOMY: Investors are pulling back as signs mount that growth in the world's biggest economy is slowing. A Conference Board report on Tuesday showed that consumer confidence unexpectedly fell to its lowest in four months, knocked by a slowdown in hiring. Further bad news is expected when an initial estimate of first quarter growth is released later Wednesday. Economists are expecting quarterly growth of 1 percent, down from 2.2 percent in the previous period, because of severe winter weather and a stronger dollar that's hurting American manufacturers.
FED STATEMENT: Hours after the U.S. economic data is released, the Federal Reserve is set to issue a policy statement from its two-day meeting. Investors will be looking for any hints on when it will raise interest rates but expectations now are that they'll stay at record lows until at least September. The tempered outlook has also weakened the dollar against other major currencies.
ANALYST VIEW: "Traders looking for direction will look no further" than U.S. first quarter GDP data and the Fed statement, said Will Leys, a CMC Markets sales trader in Sydney. "These events could potentially confirm a soft run of U.S. data, and continue the greenback's recent wane. Conversely, if there's a surprise to the upside, the Fed's first rate raise may be back on the cards."
ASIA'S DAY: Hong Kong's Hang Seng lost 0.2 percent to 28,400.34 and South Korea's Kospi fell 0.2 percent to 2,142.63. The Shanghai Composite Index in mainland China ended flat at 4,476.62 after swinging between losses in the morning and gains in the afternoon. Australia's S&P ASX/200 sank 1.9 percent to 5,838.60. Japan's stock market was closed for a holiday.
EARNINGS: Weak first quarter corporate earnings reports from major companies put a damper on Asian investor sentiment. Samsung Electronics Co. said its first quarter earnings plunged 39 percent as consumers switched to Apple's bigger iPhones. LG Electronics Inc. said profit plunged 59 percent because of losses at its TV business. State-owned Agricultural Bank of China Ltd. reported that profit edged up just 1.5 percent as the world's second biggest economy slowed.
CURRENCIES: The dollar rose to 119.14 yen from 118.82 yen late Tuesday. The euro fell to $1.0997 from $1.0972.
ENERGY: U.S. benchmark crude dipped 38 cents to $56.67 a barrel in electronic trading on the New York Mercantile Exchange. The contract rose 7 cents to close at $57.06 a barrel on Monday. Brent crude fell 42 cents at $64.24 a barrel in London.