Monday 29 July 2013 2:22 am

Before the open – 29/07 – Asian stocks down, FTSE seen opening higher

Asian stocks traded lower last night as weak Chinese manufacturing data heightened fears of a hard landing and investors showed caution ahead of the US Federal Open Market Committee (FOMC) policy statement later this week.

The Nikkei fell below the 14,000 mark for the first time in nearly a month as the yen strengthened against the dollar – hitting exporters. Meanwhile, it was reported that Japanese retail trade rose by 1.6 per cent in the year to June, an increase from the 0.8 per cent rise the month before, but falling short of economists’ expectations of 1.9 per cent growth. The Nikkei was down around 2.8 per cent at 13,738.

This morning, Bank of Japan governor Haruhikho Kuroda said a planned increae in the sales tax rate to eight per cent in April 2014 from five per cent currently would not hurt the economy, and was needed to repair public finances. This comes amid growing signs that prime minister Shinzo Abe could delay or water down the policy as he seeks alternatives.

In China, the Hang Seng and Shanghai Composite fell by around 0.6 per cent and 1.5 per cent respectively after China’s National Bureau of Statistics said on Friday that profits at Chinese industrial firms grew by 6.3 per cent in June – down from 11.5 per cent growth the month before. In the first half of the year, industrieal profits were up 11.1 per cent, down from 12.3 per cent in the first five months.

Meanwhile, investors are waiting to see what is said at the FOMC meeting this Wednesday, looking for further clues about the timeline for the scaling back of quantitative easing. There’s also US jobs data out on Friday that could tip the scale.

The FTSE is expected to open higher this morning