Global markets edge lower as China reports slower growth in the last quarter

Markets fell in Europe and Asia after China reported Wednesday that its economy grew at a 4.9 per cent annual pace in July-September, down from 6.3 per cent in the previous quarter.

Oil prices jumped more than $1. Germany’s DAX was unchanged at 15,253.87 while the CAC 40 in Paris also was virtually flat at 7,028.83.

Britain’s FTSE 199 fell 0.2 per cent to 7,656.76 as the government reported that inflation held steady at 6.7 per cent in September as easing food and drink price rises were offset by higher fuel costs.

The future for the S&P 500 lost 0.2 per cent and that for the Dow Jones Industrial Average was 0.1 per cent lower.

China’s National Bureau of Statistics said the world’s second-largest economy slowed in the summer as global demand for exports faltered and the ailing property sector sank deeper into crisis.

The Chinese government has acted to help the economy with various policies, raising spending on building ports and other infrastructure, cutting interest rates and easing curbs on home-buying. But economists say wider reforms are needed to address longer-term problems, such as a fast-aging population and falling productivity, that are hindering growth.

Weak global demand and the property industry remain the biggest shadows overhanging the economy in the near term, economists said.

“The wider data on the property sector remained weak, although green shoots are appearing,” Capital Economics said in a report. “New housing starts continued to drop and are now at their lowest levels since 2005,” it said.

Hong Kong’s Hang Seng shed 0.1 per cent to 17,756.02 and the Shanghai Composite index dropped 0.8 per cent to 3,058.71.

The Nikkei 225 in Tokyo closed flat, gaining less than 2 points to 32,042.25. South Korea’s Kospi added 0.1 per cent to 2,462.60 and Australia’s S&P/ASX 200 advanced 0.3 per cent to 7,077.60.

Bangkok’s SET rose 0.5 per cent and India’s Sensex skidded 0.7 per cent.

On Tuesday, the S&P 500 edged down less than 1 point to 4,373.20. The Dow Jones Industrial Average added less than 0.1 per cent, to 33,997.65, and the Nasdaq composite fell 0.3 per cent, to 13,533.75.

A report on Tuesday showed shoppers spent more at U.S. retailers last month than economists expected. But a too-hot economy could also give inflation more fuel and push the Fed to keep interest rates high to suffocate it. Such a move would hurt prices for stocks and other investments.

Treasury yields in the bond market rose. The yield on the 10-year Treasury climbed to 4.83 per cent from 4.69 per cent late Monday.

A sharp jump since the summer in the 10-year yield has weighed on the stock market, as traders increasingly accept the Fed’s forecasts that it will likely keep rates high for a long time. The central bank has already pulled its main interest rate to the highest level since 2001 and is debating whether to increase it one more time.

Nvidia and other chipmakers were under extra pressure after the U.S. government broadened restrictions to stop China from acquiring advanced computer chips and the equipment to manufacture them. Nvidia fell 4.7 per cent.

Several big U.S. companies, meanwhile, gained following their latest earnings reports.

Bank of America was helping to lead the market with a 2.3 per cent gain after it beat Wall Street’s profit forecasts for the third quarter.

Bank of New York Mellon rose 3.8 per cent after it also reported stronger profit than expected for the latest quarter.

The broad expectation for companies across the S&P 500 index is that profits returned to growth during the summer for the first time in a year.

Wyndham Hotels & Resorts rose 9 per cent after rival Choice Hotels International said it wants to buy the company for $90 per share in cash and stock, valuing it at $7.8 billion.

Wyndham said it rejected the offer as “underwhelming.” Choice shares fell 6.8 per cent.

Crude oil prices advanced Wednesday as worries flared that war in the Middle East could lead to disruptions in supplies if it drew in Iran or other major oil-producing countries.

A barrel of U.S. crude for delivery in November jumped $1.66 to $88.32 per barrel in electronic trading on the New York Mercantile Exchange. It was unchanged Tuesday after bouncing between gains and losses through the day. Brent crude, the international standard, gained $1.51 to $91.41 per barrel.

In currency trading, the dollar slipped to 149.76 Japanese yen from 149.82 yen. The euro rose to 1.0579 from $1.0576.