AFP/London

European equities retreated yesterday despite gains across Asia, as sentiment was hit by fresh fears over Syria and the possible withdrawal of US Federal Reserve stimulus, dealers said.

London’s benchmark FTSE 100 index ended the day down 0.25% at 6,530.74 points.

Frankfurt’s DAX 30 was virtually unchanged at 8,276.32 points and the CAC 40 in Paris slid 0.22% to 4,040.33 points.

The European single currency climbed to $1.3211 from $1.3180 late on Friday. The dollar rose to ¥99.37 from ¥99.07.

On the London Bullion Market, gold prices firmed to $1,390an ounce from $1,387.

“Expectations of a positive start for Europe’s markets after the recent Chinese and Japanese data soon gave way to the proverbial elephant in the room of Syria, as markets digested weekend comments from President Bashar al-Assad that Syria and its allies would strike back if attacked,” said Michael Hewson, senior market analyst at CMC Markets UK.

“While these concerns have restricted any prospect of strong gains and kept Europe’s markets on the back foot for most of the day, the likelihood of an imminent strike from the US still looks slim at this stage,” he said.

Markets are also hampered by lingering fears that the US Federal Reserve could decide soon to taper, or wind down, its vast stimulus policy known as quantitative easing.

Weaker-than-forecast US jobs figures raised concerns on Friday about the world’s number one economy but also fuelled hope that the Fed would hold off reducing its stimulus programme for the time being.

Meanwhile, sentiment remains rattled by fears of a looming intervention in Syria.

Al-Assad warned yesterday that the US would “pay the price” if it attacks Syria, as Moscow unveiled a plan to head off strikes by collecting Syrian chemical weapons.

US President Barack Obama meanwhile was to give no fewer than six media interviews later in the day to defend his plan to the US public and lawmakers, before giving a major national address today

In company news yesterday, pharmaceuticals group GlaxoSmithKline saw its share price slip 0.67% to 1,640pence following
news of a major divestment.

Japanese drinks giant Suntory has agreed to buy the British drugs firm’s top-selling Lucozade and Ribena brands for $2.1bn, the pair said.

BP shares dropped 0.33% to 444.10 pence, despite news that the British energy giant has discovered a “significant” amount of gas in the East Nile Delta in offshore Egypt after drilling the deepest ever well in the region.

On the upside, shares in Lloyds Banking Group rallied 1.82% to 76.78 pence, with sentiment buoyed after the lender relaunched its former TSB bank division back onto the high street.

US stocks opened higher yesterday on strong economic data from China and Japan.

In midday trade, the Dow Jones Industrial Average jumped 0.82%, the broad-based S&P 500 added 0.75%, while the tech-rich Nasdaq Composite Index tacked on 0.89%.

Asia stocks rise on strong Japan, China data

Asia stocks rise on strong Japan, China data

Asian markets rose yesterday as strong Chinese trade data lifted hopes for the global economic outlook, while Japanese stocks were boosted by improved growth figures and Tokyo’s successful bid to host the 2020 Olympics.

Weaker-than-forecast US jobs figures raised concerns about the world’s number one economy but also fuelled hope that the Federal Reserve will hold off winding down its stimulus programme for the time being.

Tokyo rose 2.48%, or 344.42 points, to 14,205.23. Japanese dealers bought into construction and real estate plays after Tokyo’s Olympics success, while there was also cheer for better-than expected gross domestic product data for the April-June quarter.

Sydney rose 0.71%, or 36.5 points, to 5,181.5 in the first session back after the conservative Liberal/National coalition won a weekend general election in Australia as widely expected.

Shanghai soared 3.39%, or 72.53 points, to 2,212.52 and Hong Kong added 0.57%, or 129.43 points, to 22,750.65. Seoul closed 0.99% higher, adding 19.36 points to 1,974.67.

In other markets; Bangkok surged 3.60%, or 48.06 points, to 1,384.31; Jakarta climbed 2.92%, or 118.90 points, to 4,191.26; Kuala Lumpur gained 1.35%, or 23.23 points, to 1,747.03; Taipei rose 0.34%, or 27.91 points, to 8,192.11; Manila rose 0.38%, or 22.42 points, to 5,997.04; Singapore gained 1.31%, or 39.85 points, to 3,088.20; while Wellington rose 0.37%, or 16.84 points, to 4,614.02.

Chinese data on Sunday showed exports jumped 7.2% year-on-year to $190.6bn last month, much better than the 6.0% expected by economists. It was also better than the 5.1% rise seen in July.

Tokyo dealers were already in buying mood after the Olympics result when data was unveiled showing the Japanese economy grew 0.9% over the previous quarter in April-June, up from a preliminary reading of 0.6%.

On an annualised basis the economy expanded 3.8%, the government said, up from the first estimate of 2.6%. Annualised figures show the rate of growth if the data was stretched across an entire year.