Today’s Stock Exchanges, May 16th. Markets hanging from the US debt ceiling. It disappoints Chinese industry
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MILAN – A weak day is announced for Western stocks, with investors looking to stall on the rise of the US debt ceiling after the postponement – Friday – of the meeting between President Joe Biden and the leaders of Congress, scheduled for today at the White House. Last week Biden urged Republican lawmakers to move quickly to raise the limit on loans allowed to the government from the current $31.4 trillion, or risk dragging the world’s largest economy into a recession. And yesterday US Treasury Secretary Janet Yellen reiterated that for the United States, in the absence of an agreement on the debt ceiling, “there is the possibility of default from June 1st”. Among the data that guide the mood of the day, also the Chinese industrial production lower than expected in April.
Asia mixed after Chinese data
Asian stocks are trading mixed, with Chinese stocks falling after the latest data showed China’s economy weaker than expected, with domestic demand failing to recover as hoped post-pandemic. Tokyo’s Nikkei Index rose 0.71% and Hong Kong’s Hang Seng Index rose 0.18%. The Kospi of Seoul also rose slightly, marking a +0.04%. The Shanghai Composite index lost 0.15% and the Shenzhen index fell by 0.55%.
Falling futures for Wall Street
Dow Jones futures drop 0.23%, those of the Nasdaq drop 0.10% and those of the S&P 500 register a decrease of 0.20%.
China, industrial production halved compared to expectations
Industrial production in China rose 5.6% on an annual basis, up from 3.9% in March, but about half of analysts’ estimates at +10.9%, due to weak external demand. The economic recovery is still unstable: retail sales, thanks to the Golden Week holiday, jumped by 18.4% (+10.6% in March), but less than the 21% expected. Urban unemployment drops to 5.2% (from 5.3% in March), with the youth component (16-24 years) soaring to a record 20.4% (from 19.6% in the previous month). Investments in fixed assets are holding back: +4.7% in January-April, against +5.1% in the first quarter and +5.5% expected.
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