KEEPING SCORE: Tokyo’s Nikkei 225 gained 0.3 percent to 18,177.76 while the Shanghai Composite Index shed 0.1 percent to 3,383.75. Hong Kong’s Hang Seng lost 0.4 percent 22,983.78. Seoul’s Kospi added 0.1 percent to 2,033.15. Sydney’s S&P/ASX 200 retreated 0.2 percent to 5,246.20. New Zealand, Jakarta and Bangkok gained while Singapore declined.
CHINA GROWTH: Economic growth in the July-September quarter decelerated to 6.9 percent, its lowest level since early 2009, but barely changed from 7 percent in each of the two preceding quarters. Retail sales grew strongly but growth in factory output declined. Investors had been expecting a lower number, and some forecasts were particularly pessimistic, so the outcome was a positive for the global economic outlook.
FED EXPECTATIONS: Investors were convinced the Federal Reserve held off raising interest rates in September because it was uncertain about how much global economic growth, and China’s growth in particular, was weakening. In reality, the Fed’s main concern was low inflation in the U.S. not China or the world economy. But the fact Chinese growth didn’t collapse in the third quarter removes one argument in financial markets for interest rates to be left at record lows. Super-low rates have been a boon for stock markets for several years.
QUOTABLE: “Overnight market action was dominated by a response to Chinese GDP, retail sales and industrial production numbers,” said Michael McCarthy, chief strategist at CMC in Sydney. “A clear collective conclusion is that the stronger than expected numbers remove an impediment to U.S rate rises,” he said in a commentary. “This led to a stronger U.S. dollar, weaker commodity prices and modest gains for shares as markets weighed a better global growth scenario against potentially tighter U.S. monetary policy.”
WALL STREET: A slide in oil prices hammered energy stocks and Morgan Stanley and Hasbro declined after earnings failed to meet investor expectations. Exxon Mobile fell 1.8 percent and Chevron slid 1.4 percent. The Dow Jones industrial average rose 14.57 points, or 0.1 percent, to 17,230.54. The Standard & Poor’s 500 added 0.55 points, or 0.03 percent, to 2,033.66. The Nasdaq composite rose 18.78 points, or 0.4 percent, to 4,905.47.
ENERGY: Benchmark U.S. crude gained 13 cents to $46.41 per barrel in electronic trading on the New York Mercantile Exchange. On Monday, the contract fell $1.44 to $46.28. Brent crude, used to price international oils, added 17 cents to $48.78 in London. It plunged $1.85 to $48.61 in the previous session.
CURRENCIES: The dollar declined to 119.48 yen from Monday’s 119.51 yen. The euro rose to $1.1334 from $1.1329.