World stocks climb on hopes of trade truce

Mar­kets fo­cus on the pos­si­bil­ity of a Us-china trade deal at the up­com­ing G20 sum­mit

The Gulf Today - Business - - FRONT PAGE -

LON­DON: Hopes for a thaw in Uschina trade ties at the up­com­ing G20 sum­mit helped world shares inch to a one-week high on wed­nes­day, though fears of a no-deal out­come weighed on Euro­pean bourses and kept the dol­lar firm for the fourth day in a row.

While Pres­i­dent Don­ald Trump talked tough on the trade tar­iffs is­sue ahead of a meet­ing with chi­nese pres­i­dent Xi Jin­ping on Sat­ur­day, mar­kets fo­cused on com­ments by White House eco­nomic ad­viser Larry Kud­low, who held open the pos­si­bil­ity that the two coun­tries would reach a trade deal.

A rap­proche­ment is seen as cru­cial, given that world growth and trade are al­ready show­ing signs of an alarm­ing slow­down.

Kud­low’s com­ments al­lowed Chi­ne­se­and ja­panese shares to rally 1 per cent while MSCI’S all-coun­try eq­uity in­dex was up 0.15 per cent and the pan- euro­pean bench­mark rose 0.2 per cent. Fu­tures in­di­cated a firm open­ing on Wall Street, with the S&P500, Nas­daq and Dow Jones tipped to rise be­tween 0.3-0.5 per cent.

There was some cau­tion, how­ever, es­pe­cially in Europe, which was hit on Tues­day by a re­port that Trump may soon de­cide about new taxes on im­ported cars. Europe’s auto sec­tor shares were 0.3 per cent in the red.

With the cur­rency in­dex ap­proach­ing 1-1/2-year highs reached ear­lier this month, traders are fo­cus­ing on a speech at 1700 GMT by Fed­eral Re­serve Chair Jerome Pow­ell to see if he of­fers clues on how many more times the Fed could raise in­ter­est rates.

While Fed Vice Chair Richard Clar­ida took a less dovish stance on Tues­day than some had ex­pected and backed more rate rises, Pow­ell and his col­leagues have in re­cent weeks al­luded to global volatil­ity, lead­ing many to spec­u­late the bank’s three­year-long rate rise cam­paign could pause in 2019. How­ever most reckon the Fed is on track to tighten pol­icy in De­cem­ber and early-2019 at least.

Ster­ling climbed off two-week lows to rise 0.4 per cent by 1215 GMT, hav­ing touched a ses­sion-high of $1.2806 af­ter the op­po­si­tion’s main fi­nance spokesman John Mcdon­nell said he could ac­cept a sec­ond Brexit ref­er­en­dum.

Against the euro it rose half a per cent to touch a high of 88.105 pence Mcdon­nell’s com­ments raise hopes that the Labour Party will more firmly back putting the Brexit is­sue to a sec­ond vote, should Prime Min­is­ter Theresa May fail to con­vince scep­ti­cal law­mak­ers of the ben­e­fits of her Brexit deal ahead of a De­cem­ber 11 par­lia­men­tary vote.

Newspapers in English

Newspapers from UAE

© PressReader. All rights reserved.