Left Menu
Development News Edition

World shares fall as Hong Kong, US-China tensions weigh

PTI | Bangkok | Updated: 29-05-2020 15:54 IST | Created: 29-05-2020 15:54 IST
World shares fall as Hong Kong, US-China tensions weigh

Shares fell Friday in Europe and Asia as investors awaited a news conference about China by President Donald Trump later in the day. Benchmarks slipped in Paris, Frankfurt and Tokyo but rose in Shanghai.

U.S. and Chinese officials have been trading harsh rhetoric recently on everything from Hong Kong to the response to the coronavirus outbreak. One fear is that further friction could lead to another punishing round of escalating tariffs between the two countries that would hit the global economy when it's already in a severe recession due to the coronavirus pandemic. “The world awaits Trump's news conference tonight and the market is reacting, although there is absolutely no panic at all and it's about pre-positioning," Chris Weston of Pepperstone said in a commentary.

China's National People's Congress on Thursday approved a national security law aimed at suppressing secessionist and subversive activity in Hong Kong, overriding any potential opposition by local lawmakers. U.S. Secretary of State Mike Pompeo has said the law means Washington may no longer treat the former British colony, already reeling from anti-government protests and the pandemic, as autonomous from Beijing. That could undermine the city's status as a major center for trade and finance.

Germany's DAX lost 1.4% to 11,616.15 and the CAC 40 in France slipped 1.2% to 4,712.27. Britain's FTSE 100 gave up 1.1% to 6,149.44. U.S. markets were poised for losses, with the future contract for the S&P 500 0.6% lower and the future for the Dow industrials down 0.7%. Weak economic data from Japan also cast a pall, as the government reported that industrial production fell more than 9% in April from the month before, while retail sales dropped nearly 10%, month-on-month. That was the biggest fall since a sales tax hike in 1997.

Hong Kong's Hang Seng index dropped 0.7% to 22,961.47, while Japan's Nikkei 225 index fell 0.2% to 21,877.89. Australia's S&P/ASX 200 skidded 1.6% to 5,755.70. The Kospi in South Korea added 0.1% to 2,029.60, while the Shanghai edged 0.2% higher to 2,852.35.

Overnight, the S&P 500 ended the day 0.2% lower at 3,029.73. The Dow Jones Industrial Average lost 0.6% to 25,400.64 and the Nasdaq composite fell 0.5%, to 9,368.99. Even with Thursday's loss, the S&P 500 is still on pace for its third weekly gain of at least 2.5% in the last four weeks. Following their breathtaking drop of nearly 34% in February and much of March, stocks began recovering after the Federal Reserve and Capitol Hill pledged unprecedented amounts of aid for the economy.

More recently, the market has pushed higher as investors move into stocks that would benefit most from a reopening economy. Governments around the country and around the world are slowly lifting restrictions meant to corral the outbreak, which has investors hoping the worst of the recession has already passed, or will soon. Some analysts warn the rally has been overdone could be setting investors up for disappointment in the future if economies take much longer to recover than hoped for.

The yield on the 10-year Treasury fell to 0.66% from 0.70% late Thursday. It tends to reflect sentiment about the economy's strength and inflation. A barrel of U.S. crude oil for delivery in July lost $1.07 to $32.64 per barrel in electronic trading on the New York Mercantile Exchange. It rose 90 cents to settle at $33.71 on Thursday.

Brent crude, the international standard, gave up 86 cents to $35.17 per barrel. It rose 55 cents to $35.29 per barrel in London. The dollar bought 107.25 Japanese yen, down from 107.64 yen late Thursday. The euro rose to $1.1115 from $1.1073.


TRENDING

OPINION / BLOG / INTERVIEW

Pride in the time of coronavirus: a welcome move online?

This year is different in many ways not least as celebrations are also taking place against the dramatic backdrop of a global health crisis and a resurgence in grassroots activism following the death of George Floyd in Minneapolis. ...

COVID-19: Weighing up the benefits and limitations of edtech platforms

Edtech companies shouldnt focus on merely pushing contents, but to provide an interactive, effective teaching and learning environment. ...

Shipping industry's COVID-19 resilience test could boost digitalization

The push towards digitalization in shipping industry was already happening and has been further accelerated by the pandemic as current practices are not tenable under present circumstances and would definitely not be in the future....

Health is pure science but why objectivity eludes WHO

We certainly need a global body to coordinate responses against health emergencies. However, this sheer need of humanity on this planet should not be milked by the World Organization WHO to overshadow constructive criticism and call for ref...

Videos

Latest News

Canada suspends its extradition treaty with Hong Kong, eyes immigration boost

Canada is suspending its extradition treaty with Hong Kong in the wake of new Chinese national security legislation and could take steps to boost immigration, Prime Minister Justin Trudeau said on Friday. China imposed the legislation on th...

Global coronavirus cases exceed 11 million

Global coronavirus cases exceeded 11 million on Friday, according to a Reuters tally, marking another milestone in the spread of the disease that has killed more than half a million people in seven months.The number of cases is more than do...

Man, his daughter killed by wife's lover in Ghaziabad

A man has been arrested in Ghaziabads Sahibabad area for allegedly killing the husband and the nine-year-old daughter of a woman he had an affair with, police said on Friday. The incident happened on the intervening night of Thursday-Friday...

2 women, man held for honey-trapping businessman to extort money from him

Two women and a 26-year-old man have been arrested from east Delhis Krishna Nagar area for allegedly honey-trapping a businessman to extort money from him, police said on Friday. The man has been identified as Afroz. All the three were res...

Give Feedback