World stocks poised for worst month since Jan­uary

Pakistan Observer - - ECONOMY WATCH -

LONDON —Euro­pean stocks and the pound held on to a third day of gains as the im­me­di­ate mar­ket flurry over Bri­tain’s vote to pull out of the Euro­pean Union set­tled. The re­bound was not enough, how­ever, to off­set the sharp losses suf­fered in the af­ter­math of last week’s vote which have put global stocks on track for their worst monthly per­for­mance since Jan­uary. Re­newed con­cerns over global growth and over­sup­ply have also forced oil prices onto the back foot again. Wall Street shares were ex­pected to open up 0.2 per­cent, fol­low­ing the lead from Euro­pean and Asian mar­kets.

The MSCI All-Coun­try World in­dex. MIWD00000PUS was up 0.3 per­cent, but is set to end the month down 1.6 per­cent, its worst month since a trou­bled start to the year. It will also be the first time since 2011 that global stocks will have fallen for two suc­ces­sive quar­ters. Wor­ries that a weaker Chi­nese yuan could spark de­fla­tion, seen as a key rea­son for the worst be­gin­ning to the year for global stocks, were reignited on Thurs­day after Reuters re­ported that China’s cen­tral bank was will­ing to let the cur­rency fall fur­ther. “Since the be­gin­ning of the year in­vestors have faced a se­ries of macro changes to the in­vest­ment land­scape,” said Sean Darby, chief global eq­uity strate­gist at Jef­feries, adding that Bri­tain’s de­ci­sion to leave the Euro­pean Union last week was only the most re­cent shock to in­vestor con­fi­dence. The two-day sell­off in the af­ter­math of last week’s vote wiped more than $3 tril­lion off the value of global stocks.—Reuters

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