Asian markets fell Friday amid mounting jitters over China’s manufacturing slowdown. European stocks advanced and Wall Street futures rose as traders awaited the release of U.S. housing data. Benchmark oil hovered above $105 per barrel after a big fall the day before. The dollar weakened against the euro but rose against the yen.
Britain’s FTSE 100 rose 0.5 percent to 5,873.87. Germany’s DAX gained 0.6 percent to 7,022.42 and France’s CAC-40 added 0.4 percent to 3,486.70.
In Asia, stocks were jolted for a second day in a row by an index, released Thursday, that showed renewed weakness in China’s manufacturing. The gauge compiled by HSBC fell to 48.1 in March from 49.6 in February. Figures below 50 indicate that manufacturing is shrinking.
That data comes on top of trade figures showing both Chinese and global demand falling. Weak European economic indicators added to worries about a slowdown.
“The market is disappointed that China’s manufacturing sector is shrinking, so we are seeing the start of a major correction,” said Francis Lun, managing director of Lyncean Holdings in Hong Kong.
The lack of bold reaction from China’s government is causing investor unease, analysts said. The government has indicated it favors a pro-growth policy but so far has not aggressively reduced reserve requirements for banks on a national scale or lowered interest rates.
“China hasn’t done anything to inject confidence in the market,” said Jackson Wong, vice president at Tanrich Securities in Hong Kong. “That is dragging down the whole market in Hong Kong and other areas. So now we wait to see if China will roll out some bold moves.”
Japan’s Nikkei 225 index dropped 1.1 percent to close at 10,011.47 as the country’s formidable export sector faded amid fears of slowing overseas demand. Yamaha Motor Co. shed 3.1 percent and Sharp Corp. slid 3.3 percent.
A rare gainer was Japanese food processor Yukiguni Maitake Co., which rose 0.3 percent a day after announcing a study showed that maitake mushrooms might help fight obesity, Kyodo News reported.
Elsewhere, Hong Kong’s Hang Seng lost 1.1 percent to 20,668.80 while South Korea’s Kospi edged up marginally to 2,026.83.
Australia’s S&P/ASX 200 fell nearly 0.1 percent to 4,270.40 as the country’s mining and resource shares took a pounding over worries of reduced demand from China, the world’s biggest consumer of raw materials. BHP Billiton, the world’s largest mining company, lost 1.2 percent in Sydney.
Wall Street appeared headed for a higher opening, with Dow Jones industrial futures up 0.2 percent to 13,029 and S&P 500 futures adding 0.4 percent to 1,393.90.
Later Friday, the U.S. government will release a report on the number of people who bought new homes in February. Federal Reserve Chairman Ben Bernanke will also be delivering brief opening remarks at a Fed conference on central banking in Washington.
The National Association of Realtors on Wednesday released a mixed report about the state of the U.S. housing market. Sales of previously occupied homes dipped last month, but the sales pace for the winter was the best in five years.
Housing has been dragging on the economic recovery. An oversupply of homes has weakened construction and other trades in many parts of the country.
Benchmark oil for May delivery was up 56 cents to $105.91 per barrel in electronic trading on the New York Mercantile Exchange. The contract fell $1.92 to finish at $105.35 per barrel on the Nymex on Thursday.
In currencies, the euro jumped to $1.3270 from $1.3181 late Thursday in New York. The dollar rose to 82.70 yen from 82.59 yen.