Stockmarkets in the UK and Europe have risen after opening, avoiding the falls seen in Asia, as investors hope for positive economic data from the US.
The FTSE 100 was up 45.71 points to reach 6,074.81 at 0830 BST, while the Euro Stoxx 50 was up 29.86 to 2,541.69. The FTSE’s early gain was led by ARM Holdings, followed by Aviva, William Hill, Aberdeen Asset Management and Vedanta..
Investors are awaiting the release of durable goods orders and sales of new homes in the US. These indicators are expected to show improvement during May, which would suggest the world’s largest economy is recovering but could add to evidence for the slowing of quantitative easing.
However, Asian markets slumped yesterday over fears that a new credit crunch could take the momentum out of China’s economic growth. China’s short-term cash rates soared last week after its central bank permitted money market funding to tighten to curb credit for the ‘shadow banking’ sector.
The Shanghai Composite dropped 0.19 per cent to end the session at 1,959.51, after recovering from an intra-day fall of as much as 5.3 per cent. The Nikkei 225 shed 0.72 per cent to reach 12,969.34 while Taiwan’s TSEC was down 1.22 per cent at 7,663.23.