European shares down ahead of US data, Asia gains on US earnings reports

TOKYO—European stocks were lower Wednesday ahead of U.S. economic data while cheery earnings from major Japanese companies such as Honda Motor Co. boosted Asian markets.

Keeping score

In morning trade in Europe, France’s CAC 40 dipped 0.7 per cent to 4,334.79 and Britain’s FTSE 100 edged down 0.2 per cent to 6,791.58. Germany’s DAX shed 0.3 per cent to 9,629.37. Futures painted a brighter picture for Wall Street ahead of the quarterly U.S. growth figures. Dow futures rose 0.1 per cent and S&P 500 futures gained 0.2 per cent.

Asia’s day

Asian shares were mostly higher, with Tokyo’s Nikkei 225 rising 0.2 per cent to finish at 15,646.23. The Hang Seng in Hong Kong was up 0.5 per cent to 24,759.95. South Korea’s Kospi added 1 per cent to 2,082.61. Sydney’s S&P/ASX 200 edged up 0.6 per cent to 5,622.89. Southeast Asian markets were mixed.

Happy Honda

Honda shares added 3.3 per cent after a strong quarterly earnings report Tuesday, released after Tokyo stock trading closed, which prompted the Japanese automaker to raise its full year projections. The cheap yen is working as a plus for export manufacturers such as Honda, which are expanding sales in China and other emerging markets.

US data

Markets are looking ahead to key data being released later this week. U.S. gross domestic product for the April-June quarter, scheduled for Wednesday, is among the most important. Analysts expected growth to bounce back after a severe winter hit the first quarter numbers. Federal Reserve policymakers also conclude a two-day meeting later Wednesday. The next day, there’s a report on China’s manufacturing industry, a key sign for regional growth. On Friday, the U.S. Labor Department releases its monthly jobs report.

Analyst take

News of further sanctions against Russia is likely to limit buying of stocks, says Ric Spooner, chief market analyst at CMC Markets. The U.S. and Europe announced expanded sanctions against Russia in response to the downing of a Malaysian airliner over an area of Ukraine controlled by pro-Russian separatists.

Currencies, oil

Currency rates were little changed with the euro at $1.3410 from $1.3411 late Tuesday, and the dollar at 102.17 yen from 102.10 yen. Benchmark U.S. crude for September delivery was up 47 cents to $101.44 a barrel.