Yahoo Finance What to Watch: Traders unconvinced of a China economic recovery while European chip stocks jump
Here are the top business, market and economic stories you should be watching today in the UK, Europe and abroad:
Investors wary of signs of a China economic recovery
Britain’s FTSE (^FTSE), Germany’s DAX (^GDAXI), and France’s CAC (^FCHI) fell slightly in the red in early trading as investors exercised caution over China’s positive economic data.
After hitting an eight-month high yesterday, European stock markets flitted between being down by around 1% to trading almost flat later in the morning.
Official figures showed that the world’s second largest economy — China — expanded at 6.4% in the first quarter from a year earlier — beating a Reuters forecast of 6.3%. Industrial output surged 8.5% year-on-year in March and retail sales also jumped by 8.7% year-on-year.
While this data provided signals of a recovery, thanks to a huge Chinese government stimulus measure spend, analysts said that it was “too early” to call a sustainable turnaround.
“Despite the stronger-than-expected data set, market response seems to be quite muted with a largely flat Shanghai Composite in the morning session,” said Michelle Qi, chief investment officer, equities at Eastspring Investments, in a statement to Yahoo Finance UK.
“Considering that Q1 is already behind us, we believe market focus would then turn to potential changes in policy stance as well as the sustainability and strength of the ongoing economic recovery.”
Miners were also to blame for leading markets lower.
READ MORE: China’s economy performed better than expected — signalling a recovery
European chip stock provide upside
Chip stocks in Europe — STMicro (STM.PA), Dialog Semi (DLG.F), Siltronic (WAF.F) — were all up between 1% to 4.8% after the share price in the US Qualcomm (QCOMM) rocketed by 23% Tuesday.
Qualcomm revealed yesterday that it won a major legal dispute with Apple (AAPL), which centered on technology that enables iPhones to connect to the internet.
Qualcomm’s victory means that Apple has to pay the group an undisclosed amount and that there would be a six-year licensing agreement that likely involves recurring payments to the chip maker.
READ MORE: Qualcomm stock jumps on surprise settlement with Apple
