A woman walks past an electronic board showing Hong Kong share index outside a local bank in Hong Kong, Monday, April 1, 2019. Shares have surged in Asia following a bullish Friday on Wall Street, where the benchmark S & P 500 logged its biggest quarterly gain in nearly a decade. (AP Photo/Vincent Yu)

World stocks rise on improved Chinese manufacturing data

April 01, 2019 - 7:21 am

BANGKOK (AP) — Stocks around the world rose Monday on encouraging manufacturing data out of China that suggested government stimulus there may be gaining traction.

European shares were up in midday trading despite bad economic reports there, with Germany's DAX gaining 1 percent to 11,645. The CAC40 in France advanced 0.5 percent to 5,378 and Britain's FTSE 100 rose 0.6 percent to 7,324.

Wall Street looked to extend gains from last week, with the future contract for the Dow Jones Industrial Average up 0.6 percent to 26,095. The S&P 500 future also gained 0.6 percent, to 2,855.

China's statistics bureau and an industry group said Sunday their monthly purchasing managers' index rose to 50.5 on a 100-point scale on which numbers above 50 show activity increasing. That was up 1.3 points from February.

Sub-indexes for exports, employment and new orders all improved, and an index showing companies' expectations for future new business rose 0.6 points to 56.8.

"There is a lot of optimism and feelings of joy among investors today," Naeem Aslam of Thinkmarkets.com said in a commentary, "thanks to the Chinese economic data which has painted a very optimistic picture."

Things looked less rosy in Europe, where a report showed that inflation fell further away from the European Central Bank's target of 2 percent, a potential sign of economic weakness. Another closely monitored survey showed the manufacturing sector shrinking at its fastest rate in six years. The developments suggest Europe is struggling to cope with global trade tensions and the uncertainty of Brexit, among other things.

In Asia, Japan's Nikkei 225 index added 1.4 percent to 21,509.03, easing off earlier highs after economic data showed conditions for manufacturers deteriorating. The Shanghai Composite index jumped 2.6 percent to 3,170.36 and Hong Kong's Hang Seng added 1.7 percent to 29,554.74.

The Bank of Japan reported Monday that a survey of major manufacturers showed business sentiment worsening in March compared with three months earlier.

Adding to economic gloom in Japan, the Nikkei Japan purchasing manager's index showed output in manufacturing falling at its fastest rate in nearly three years in March due to weak demand both at home and abroad.

"The economic backdrop for the manufacturing sector in Japan remains fiercely challenging," Joe Hayes, an economist at IHS Markit, which compiles the survey, said in a commentary. "Asian goods producers face headwinds from slowing growth in Europe and China, while global trade risks are yet to be mitigated by a breakthrough in U.S.-China relations."

Investors are hoping for progress in U.S.-Chinese trade talks that are due to resume in Washington after a round in Beijing last week that U.S. Treasury Secretary Steven Mnuchin described as "constructive."

Officials from the world's two biggest economies are aiming to put to rest a dispute over technology and other issues. Chinese Vice Premier Liu He is expected to travel to Washington next week.

Investors also will be focusing more on corporate earnings in coming weeks, as the next big wave of company results kicks into gear in mid-April.

Elsewhere, South Korea's Kospi climbed 1.3 percent to 2,168.28 and the S&P ASX 200 rose 0.6 percent in Australia to 6,217.00. India's Sensex gained 0.8 percent to 38,981.69 and shares also rose in Taiwan, Singapore and Thailand. Indonesia's benchmark fell.

ENERGY: Benchmark U.S. crude picked up 58 cents to $60.72 per barrel in electronic trading on the New York Mercantile Exchange. It rose 1.4 percent to settle at $60.14 a barrel on Friday. Brent crude, used to price international oils, advanced 99 cents to $68.57 per barrel.

CURRENCIES: The dollar rose to 110.98 Japanese yen from 110.85 yen on Friday. The euro strengthened to $1.1232 from $1.1219.

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Matt Ott in Madrid contributed to this report.

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