Market Overview

Asian Stocks Rally On China's Large Gains While Europe Trades Lower

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Asian stocks were mostly higher on Tuesday, led by a surge in Chinese stocks. Investors and traders brushed off a brief flash crash in China's CSI 300 index in which Chinese stock futures plunged 12.5 percent on heavy volume. However, within one minute of the flash crash the index was back in the green.

According to CNBC, investors and traders were bullish on Chinese stocks after a report by Goldman Sachs suggested that there is now a 70 percent chance Chinese A-shares will be included in the MSCI index, up from a prior estimate of 50 percent.

CNBC also noted there is speculation that China's "National Team" could be supporting a rally in brokerage stocks that led to a boost in the mainland market.

Meanwhile, Japan's industrial output for April rose 0.3 percent while estimates were calling for a 1.5 percent fall.

China's Shanghai index surged 3.34 percent while Japan's Nikkei index gained 0.98 percent. Hong Kong's Hang Seng index also gained 0.90 percent.

Australia's ASX index lost 0.47 percent, India's Mumbai index lost 0.22 percent and Taiwan's TSEC index closed flat for the day.

On the other hand, most European major indices were mostly lower with more than four hours of trading remaining. Euro area inflation remained in negative territory throughout May.

According to Eurostat, inflation in the eurozone read -0.1 percent, a far cry from the European Central Bank's target of 2 percent. European data also showed that the eurozone's unemployment rate fell by 63,000 but the jobless rate remained unchanged at 10.2 percent.

Germany's DAX index was lower by 0.39 percent, France's CAC index was lost by 0.32 percent and the UK's FTSE index lost 0.16 percent.

Brent crude futures were trading lower by $0.26 a barrel at $49.50, while US WTI crude oil futures were higher by $0.09 at $49.42. OPEC nations will gather on Thursday for a meeting in Vienna to discuss the organization's policy.

"Anyone betting on a surprise outcome in Thursday's meeting is brave in doing so," Reuters quoted Vienna-based JBC Energy as saying in a note on Tuesday. "But of course, as with any base case assumption and with a new Saudi oil minister in town, there are alternative scenarios imaginable."

Posted-In: Asian Stocks Chinese stocks CNBCNews Commodities Global Pre-Market Outlook Markets

 

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