Tuesday, July 10, 2012

Asian stocks drop after weak US jobs growth

(AP) ? Asian stocks were lower Monday after a disappointing U.S. jobs report stoked concern that the world's biggest economy remains mired in weak growth.

The U.S. economy added a less than expected 80,000 jobs last month, the Labor Department said Friday. The tepid employment growth, which followed the first drop in U.S. manufacturing in three years, increases pressure on the Federal Reserve to implement monetary stimulus measures known as quantitative easing.

The release later this week of the minutes of the last Fed meeting might show whether the Fed is leaning toward more stimulus to boost growth.

"The obvious concern is that this is the start of a slowdown that will lead to another recession," Capital Economics said in a report. "Although it is very clear that the U.S. economy has lost a lot of momentum, there are no real indications that it will soon come to a complete standstill or even go into reverse."

Japan's Nikkei 225 index fell 0.8 percent to 8,953.11 and Hong Kong's Hang Seng was down 1.5 percent to 19,495.88.

South Korea's Kospi slipped 1.3 percent to 1,834.08. Australia's S&P/ASX 200 dropped 0.7 percent to 4,130.70 and China's Shanghai Composite shed 1.1 percent to 2,199.16.

Inflation figures for China released Monday showed the consumer price index at its lowest since January 2010. That will give Beijing leeway to continue adding stimulus to fight an economic slowdown. China is scheduled to release its latest trade numbers Tuesday and retail sales, industrial production and gross domestic product on Friday. In a surprise move, China last week cut interest rates for a second time in a month.

"All these easing measures should filter through to generate a modest growth recovery," said HSBC economist Qu Hongbin.

On Friday, the Dow Jones industrial average closed down 1 percent at 12,772.47. The Standard & Poor's 500 fell 0.9 percent to 1,354.68. The Nasdaq composite was down 1.3 at 2,937.33.

Benchmark oil for August delivery was up 47 cents at $84.92 a barrel in electronic trading on the New York Mercantile Exchange. Crude fell $2.77 cents to settle at $84.45 on Friday in New York.

In currencies, the euro rose slightly to $1.2393 from $1.2285 on Friday in New York. The dollar fell to 79.57 yen from 79.68 yen.

Associated Press

Source: http://hosted2.ap.org/APDEFAULT/f70471f764144b2fab526d39972d37b3/Article_2012-07-08-World%20Markets/id-7d6568cef51043d2bb5f791c2e6969f1

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