On 13 August, 2015 – Most European markets rose despite concerns over China

Stocks advanced Thursday as the People’s Bank of China sought to ease tensions caused by the devaluation of the renminbi.
United States
Investors shifted their attention to growth Thursday as tensions emanating from the renminbi devaluation eased. Riskier assets stabilized after being rattled by worries over China’s economic growth over the past two days. A solid US retail sales report points to an improving US economy, bolstering the case for the Federal Reserve to raise short term interest rates next month. The major indexes wobbled between slight gains and losses. The Dow Jones industrials were virtually unchanged while the S&P and Nasdaq slipped 0.1% and 0.2% respectively.
Data today showed July retail sales were up 0.6% on the month on growing demand for everything from cars to clothing. A decline in June was wiped away, signaling consumers are contributing to growth. A separate report showed applications for unemployment benefits in the US are hovering close to a four decade low, a sign of muted firings and steady progress in the labor market.
Coty advanced after its sales beat estimates for the first time in five quarters, while Kohl’s declined after its same store sales missed expectations. News Corp gained after profits topped estimates, helped by cost cuts at its news business. Advance Auto Parts rallied thanks to better than estimated quarterly profits. O’Reilly Automotive and AutoZone also gained. Home Depot and Lowe’s were higher. PulteGroup and Toll Brothers increased to their highest levels since April. Cisco Systems climbed after its quarterly revenue beat estimates. Consol Energy and Transocean declined. Crude oil slumped to a six-year low intraday as a global glut and a rising dollar curbed investor demand for commodities.
Gold at the afternoon London fixing was down US$2.25 to US$1,116.75. Copper futures were up 0.2% to US$2.35. WTI spot crude was down US$1.15 to US$42.15. Dated Brent spot crude was down 51 US cents to US$49.15. The US dollar was up against all of its major counterparts including the euro, yen, pound, Swiss franc and the Canadian and Australian dollars. The Dollar Index edged up 0.1%. The yield on US Treasury 30 year bond was up 2 basis points to 2.86% while the yield on the 10 year note was up 3 basis points to 2.18%.
Europe
European equities rebounded Thursday with the exception of the FTSE. Investors were in a better mood despite concerns about China after it shocked investors when it devalued its currency. The FTSE was virtually unchanged (down 2.86 points) while the CAC, DAX and SMI added 1.2%, 0.8% and 1.5% respectively.
A combination of miners and oil companies left the FTSE little changed even as German, French, Spanish and Italian stocks jumped as the fears generated by China’s depreciation of its currency eased. Royal Dutch Shell and Rio Tinto inflicted some of the damage on the index, which is now little changed for the year. Also dragging down the FTSE were companies trading without the attraction of their latest dividend payment, including Shell and BG as well as Rio Tinto BT and Pearson.
TUI surged after posting a third-quarter profit. ThyssenKrupp was flat after saying profits surged last quarter. Rival Salzgitter was also flat after it posted improved earnings. SMA Solar surged after the company reported narrower loss for the first half of the year. RWE declined after it said it expects its UK supply business to close the year significantly below last year, even though a moderate improvement in earnings had previously been expected. Michael Page climbed after announcing a special dividend. AP Moeller-Maersk, which reported second-quarter results, advanced in Copenhagen. Nestle gained in Zurich after a court in India lifted a ban on the company’s Maggi noodles. The Swiss foods giant also reported first half results, with a warning that its recall of Maggi noodles would continue to dampen earnings into the second half. Energy companies including Royal Dutch Shell and BG Group retreated.
Asia Pacific
Asian stocks advanced Thursday as the People’s Bank of China moved to stem the sell-off in its currency. After setting the guiding rate for its yuan lower for a third day, the PBoC reportedly ordered state-run banks to buy the currency at designated rates. At a press conference held Thursday morning in Beijing, the PBoC said that the currency would strengthen again and there was no basis for continued depreciation in the yuan. While pledging to improve the yuan’s pricing mechanism, central bank officials dismissed speculation of a possible yuan drop of 10% as “groundless”. The soothing comments by authorities coupled with a rebound in commodity prices and speculation that Federal Reserve officials may delay raising rates drove investors towards stocks once again, reducing the appeal of perceived safe haven assets. The Shanghai Composite index reversed early losses to end up 1.8%. The Hang Seng added 0.4% even though Lenovo tumbled after reporting a sharp profit drop and announcing worldwide job cuts.
The Nikkei added 1.0%, rebounding from hefty losses in the previous trading session and despite disappointing core machinery orders data. Japan’s core machinery orders, an indicator of capital spending in the coming six to nine months, plummeted 7.9% in June, marking the first drop in four months as exports slumped and consumer spending slackened. Fast Retailing, Tokyo Electron and Trend Micro rallied. Softbank retreated after the telecoms group acquired additional shares in US wireless carrier Sprint.
Both the S&P/ASX and All Ordinaries were up 0.1% after two days of losses as a recovery in commodity prices encouraged bargain hunters to step in. BHP Billiton, Rio Tinto and Fortescue Metals Group advanced. Gold miners Newcrest and Evolution Mining jumped after gold prices rose for a fifth straight session overnight. Oil Search, Santos and Woodside Petroleum gained after oil prices edged higher from six-year lows.
The Kospi added 0.4% after the Bank of Korea kept its monetary policy unchanged. Its key interest rate is 1.5% for a second month. The monetary policy committee said it expects the domestic economy to show a trend of recovery going forward, owing chiefly to the expansionary macroeconomic policies and to the ending of the MERS outbreak. The Sensex edged up 0.1% as the yuan’s decline slowed and investors cheered better than expected domestic data on consumer inflation and industrial output.
Global Stock Market Recap

Please remember, the value of investments and the income from them can do down as well as up. Funds that invest in overseas markets may be subject to currency fluctuations. Investments in small and emerging markets can be more volatile than other overseas markets. Reference in this document to specific securities should not be construed as a recommendation to buy or sell these securities, but is included for the purposes of illustration only.
Looking forward*
India posts July WPI. In Europe, flash second quarter gross domestic product will be released for the Eurozone, France, Germany and Italy. Final harmonized index of consumer prices for July also will be released. In the US, July producer prices and industrial production and preliminary consumer sentiment for August will be reported.
*Note — all releases are listed in local time.