Euro, pound fall back against dol­lar

Kuwait Times - - BUSINESS -

LON­DON: The euro and pound fell against the dol­lar yes­ter­day af­ter ral­ly­ing last week when cen­tral banks sig­naled tighter mon­e­tary pol­icy in re­ac­tion to solid eco­nomic growth and high in­fla­tion. As the year’s sec­ond half got un­der way, Euro­pean stock mar­kets re­bounded from heavy falls ahead of the week­end. The dol­lar last week tum­bled af­ter the ECB, Bank of Eng­land and Bank of Canada in­di­cated that the age of cheap cash-in place since the fi­nan­cial cri­sis-was draw­ing to a close as the world econ­omy gets back on track.

“I think the co­or­di­na­tion of lan­guage re­flects a co­or­di­na­tion of the recog­ni­tion that the global econ­omy is point­ing higher and the time for emer­gency poli­cies in in­di­vid­ual ju­ris­dic­tions has ended,” Greg McKenna, chief mar­ket strate­gist at Ax­iTrader, said yes­ter­day. Dur­ing the first half, the euro jumped about ten per­cent against the dol­lar, while the pound gained al­most as much from its Jan­uary lows, de­spite. Bri­tish po­lit­i­cal un­cer­tainty caused by the coun­try’s de­ci­sion to leave the EU.

On eq­uity mar­kets yes­ter­day, Lon­don’s bench­mark FTSE 100 in­dex was up 0.4 per­cent around mid­day, com­pared with Fri­day’s close. In the eu­ro­zone, Frank­furt’s DAX 30 gained 0.7 per­cent and the Paris CAC 40 jumped 1.0 per­cent, as traders re­acted to re­gional man­u­fac­tur­ing PMIs. The UK’s man­u­fac­tur­ing read­ing came in at a three-year low of 54.3, which “doesn’t bode well for the coun­try’s sec­ond quar­ter growth”, noted Spreadex an­a­lyst Con­nor Camp­bell. “While the UK econ­omy suf­fered its lat­est set­back, the eu­ro­zone continued to power ahead, with the re­gion’s own man­u­fac­tur­ing PMI ar­riv­ing at a six-year peak of 57.4,” he added in a note to clients.

In com­pany news yes­ter­day, shares in EDF were down 0.6 per­cent at 9.43 eu­ros af­ter the French power sup­plier said a project to build a nu­clear plant at Hink­ley Point in Bri­tain will over­run by £1.5 bil­lion ($1.95 bil­lion, 1.71 bil­lion eu­ros), as it warned also of de­lays of up to 15 months. EDF is part of a French-Chi­nese con­sor­tium that was awarded the two-re­ac­tor project last year de­spite crit­i­cism from green groups and cost warn­ings from ex­perts. Else­where yes­ter­day, Tokyo’s Nikkei stocks in­dex ended 0.1-per­cent higher, boosted by a slightly weaker yen and a pick-up in con­fi­dence among Ja­panese busi­nesses, traders said.

How­ever, in­vestors were spooked by a huge de­feat for Prime Min­is­ter Shinzo Abe in Tokyo assem­bly elec­tions, with his rul­ing party los­ing more than half its seats as he is rocked by a series of scan­dals and fall­ing sup­port. Shang­hai mean­while edged 0.1 per­cent up fol­low­ing a bet­ter-than-ex­pected pri­vate sur­vey show­ing Chi­nese man­u­fac­tur­ing ex­panded last month. China yes­ter­day widened ac­cess to its $10-tril­lion bond mar­ket, which an­a­lysts said will boost Bei­jing’s drive to in­ter­na­tion­al­ize the yuan and more deeply in­te­grate its mar­kets with the world fi­nan­cial sys­tem. —AFP

TOKYO: A man walks in front of a stock quo­ta­tion board of the Tokyo Stock Ex­change in front of a se­cu­ri­ties com­pany in Tokyo.—AFP

Newspapers in English

Newspapers from Kuwait

© PressReader. All rights reserved.