Market Buzz: Negative vibrations abroad drag down Russian stocks

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Published time: January 31, 2013 05:37
Edited time: January 31, 2013 13:54

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Economy, Markets, Russia and the global economy

Russian markets closed in negative territory on Wednesday. The MICEX dropped by 0.41% while the RTS was off 0.31%.

The indices fell amid negative Q4 macroeconomic data coming from the US, which will most likely continue to weigh on Russian stocks today.

The US economy shrank 0.1% in 4Q 2012, which marked the first contraction since the recession ended in 2009. The drop came mostly on the back of government spending cuts. However, the basic elements of domestic economy – housing, consumer spending and business investment – performed stronger. That’s "the best-looking contraction in US GDP you'll ever see," as the Wall Street Journal quoted Research firm Capital Economics.

North American markets also finished in the red after Wednesday’s session. The S&P 500 slid by 0.39%, the Dow Jones fell by 0.32% and the NASDAQ dropped by 0.36%. Higher-than-expected corporate earnings posted by Boeing and Facebook failed to buoy domestic stocks.

A number of corporate earnings reports are expected to be posted today, including those from MasterCard Inc, Colgate-Palmolive Co., Deutsche Bank AG and Siemens Ltd. A raft of macroeconomic data is also due to arrive later in the day: New registered unemployment cases, consumer spending and income in January, and PMI from Chicago.

Asian stocks traded mostly lower, with Japanese, Hong Kong and Australian markets all falling from multi-year highs, as investors analyzed earnings reports and global economic data from the US and Japan. Japan’s Nikkei Stock Average is lower by 0.69%, South Korea's Kospi traded down 0.27% and Australia’s S&P/ASX 200 index lost 0.24%. In China, Hong Kong’s Hang Seng Index declined 0.50% while the Shanghai Composite Index grew by 0.10%.

European stocks saw broad-based losses on Wednesday due to poor US economic data, and investors remained cautious ahead of the conclusion of the Federal Reserve’s first policy meeting of 2013. The Stoxx Europe 600 index slid by 0.6% after climbing to its highest closing level since February 2011 on Tuesday. In France, the CAC 40 was down 0.54%, while Germany's DAX was off 0.47% and London's FTSE 100 fell by 0.25%.

Oil prices showed mixed dynamics, with Brent gaining 0.12% and WTI dropping by 0.02%.

Comments (3)

Mighty (unregistered) 01.02.2013 06:15

Who cares (unregistered) Febr uary 01, 2013, 09:01 quote 0 W ho cares about the stock market. Obviously nobody... except the 1%. ''Walstreet directly effects mainstream.'' This means that you should care, and by ''Walstreet'' people mean stock markets. If Russias stock market does bad, their whole economy does bad, if it does good, their whole economy does good.

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Who cares (unregistered) 01.02.2013 05:01

Who cares about the stock market. Obviously nobody... except the 1%.

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Hin Brahmin Bodhcong Pala (unregistered) 31.01.2013 11:36

It's funny. But it's not so funny. You might think that a demand-rate auction would be only a straightforward mechanics which is consistent with all other market structures around the world. Except the actual function and design in Russia of anything roughly approximating the definition of urban population center, is very different than the pan-national stock market structures of the other Urban Glomerates. Any City suburb will always prove itself to be a useless permanent dull void , by structure and function. I do not approve of any City, but I can admit that the design and function of Russias' large traditional building complexes was organically created for the far north latitudes. If the markets are located at City's; and Russia will not really have a City but will have actually a cold weather, high up, bunker system for the winter; what relationship has the Russian markets to the other markets to the West? Probably not much. But I guess that the investors and traders will make a profit where they can.

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