1. China Q4 growth slows to 6.8%, weakest since 2009
China’s economy grew 6.8% in the fourth quarter from a year earlier, the weakest pace of growth since the first quarter of 2009. That was in line with market expectations and down from growth of 6.9% in the previous three months.
Full-year growth was 6.9%, the slowest pace of expansion in a quarter of a century but roughly in line with the government's growth target of around 7%.
A separate report showed that industrial production rose by an annualized rate of 5.9% in December, below expectations for a 6.0% increase and following a gain of 6.2% in the preceding month.
Data on fixed asset investment and retail sales also missed forecasts, reinforcing views that Beijing will roll out further support measures soon for the world's second largest economy.
2. Global stocks rally as China GDP triggers stimulus hopes
China’s stock markets staged a broad rally Tuesday, after fourth quarter growth met expectations and sparked hopes for more stimulus from Beijing to support the world’s second largest economy.
The Shanghai Composite Index closed up 3.2% to record its first back-to-back session increases this year, with gains accelerating in the afternoon.
The rest of Asia also closed higher, with Japan’s Nikkei 225 rising 0.55%, while Australia’s ASX/200 closed up 0.9%. Both benchmarks have been flirting with bear market territory in recent days.
The upbeat mood spilled over to Europe, where Germany's DAX rallied 2%, the EURO STOXX 50 jumped 2%, France’s CAC 40 rose 2.3%, while London’s FTSE 100 advanced 1.9%.
Elsewhere, Wall Street pointed to strong gains at the open, with the Dow futures up 1.5%, or 240 points. U.S. markets were closed Monday for the Martin Luther King Jr. holiday.
3. U.S. earnings season gathers pace
Bank of America (N:BAC), Morgan Stanley (N:MS), Delta Air Lines (N:DAL), United Health (N:UNH) and Charles Schwab (N:SCHW) are all due to report quarterly earnings ahead of Tuesday’s opening bell.
And after the market closes, IBM (N:IBM), Netflix (O:NFLX), Advanced Micro Devices (O:AMD) and Cree (O:CREE) are on the earnings docket.
4. Oil futures surge as China stimulus talk heats up
Oil prices soared on Tuesday, as slowing growth in China raised hopes for further stimulus for the world’s second largest economy. China is the world's second largest oil consumer after the U.S. and has been the engine of strengthening demand.
Brent jumped $1.30, or 4.55%, to trade at $29.85 by 10:45GMT, or 5:45AM ET. A day earlier, London-traded Brent prices sank to $27.67, a level not seen since October 2003.
Meanwhile, U.S. crude rose 59 cents, or 1.92%, to $30.98 after falling to $29.35 on Monday, the weakest level since October 2003.
Monday’s losses came as Iranian exports were set to resume after Western sanctions were lifted, fueling fears over increased supplies amid a global supply glut and slowing demand.
5. IMF cuts global growth outlook
For the third time in less than a year, the International Monetary Fund has cut its global growth forecasts, citing a sharp slowdown in China, weak commodity prices and rising interest rates in the U.S.
The IMF now predicts that the global economy will grow 3.4% in 2016 and 3.6% in 2017, compared to previous estimates of 3.6% and 3.8% respectively.
