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Asia stocks drop on Greek woes; Nikkei down 0.16%

Published 05/16/2012, 10:54 PM
Updated 05/16/2012, 10:55 PM
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Investing.com - Asian stocks were mixed to lower on Thursday, brushing off Japanese growth numbers and continued to price in the possibility of an eventual Greek exit from the eurozone.

During Asian trading on Thursday, Hong Kong's Hang Seng Index was up 0.45%, Australia's S&P/ASX200 was down 0.59%, while Japan’s Nikkei 225 Index was down 0.16%.

In Japan, the government reported the country's gross domestic product grew 1% in the first quarter from the fourth quarter, beating out market calls for 0.9% growth.

The country's GDP shrank 0.2% in the fourth quarter.

Still, Greece is headed for a new round of elections on June 17, and worries are building results will reveal widespread anger at austerity tied to bailout assistance.

Leftist and fringe politicians fared better than expected in May 6 elections and thwarted attempts to create a coalition government due to opposition over austerity measures they see thrust upon the country from abroad, which aren't fueling any growth.

Europe is a key export market for many Asian countries and a mess Greek exit could rattle the continent and crimp demand from Asian exporters.

Meanwhile in the U.S., the Federal Reserve reminded markets it hasn't shut the door on rolling out stimulus measures.

The Federal Reserve released the minutes of its latest monetary policy meeting earlier, revealing some policymakers favor monetary easing measures to jolt the economy, but only if recovery should wane.

"Several members indicated that additional monetary policy accommodation could be necessary if the economic recovery lost momentum or the downside risks to the forecast became great enough," the Federal Reserve minutes read.

Easing measures tend to weaken the dollar by flooding the economy with liquidity to push long-term interest rates low and encourage expansion and hiring, with stock prices climbing as a side effect.

In Hong Kong, the top gainers included China Resources Power, up 3.57%, COSCO Pacific, up 3.42%, and China Merchant Holdings, up 2.61%.

In Australia, the top decliners included Mirabella Nickel, down 11.76%, Aurora Oil & Gas, down 10.05%, and Kagara Zinc, down 7.69%.

European stock futures indicated a higher opening.

France's CAC 40 futures pointed to a gain of 0.69%, while Germany's DAX 30 futures signaled a gain of 0.52%. Meanwhile, in the U.K., the FTSE 100 futures indicated a gain of 0.51%.

Dow Jones Industrial Average futures were up 0.39% while the S&P 500 futures were also up 0.39%.

Later Thursday, the U.S. will reveal government data on weekly initial jobless claims, followed by a report on manufacturing activity in the Philadelphia area.





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