Left Menu
Development News Edition

GLOBAL MARKETS-Stocks rally on trade talks; Brexit deal hopes boost pound

Reuters | Updated: 12-10-2019 01:13 IST | Created: 12-10-2019 01:12 IST
GLOBAL MARKETS-Stocks rally on trade talks; Brexit deal hopes boost pound
Image Credit: Storyblocks

Global stocks and the euro rallied on Friday on signs of progress in U.S.-China trade talks and hopes that Britain was moving closer to a smooth exit from the European Union. The MSCI world equity index was on track for its first weekly rise in four. Frankfurt's main stock index , seen as sensitive to trade wars because of its export-oriented components, ended up 2.9% for its biggest daily gain since January 4.

The improved appetite for riskier assets carried from Thursday and improved after U.S. President Donald Trump said "good things" were happening during high-level China-U.S. trade talks and spoke of "warmer feelings." U.S. officials signaled good news was coming after a second day of trade talks with China ended, boosting investor hopes that the world's two largest economies would agree to cool the fires of their 15-month tariff war.

However, investors said they were hoping for, at best, a deal limited in scope, and noted that rhetoric had in the past failed to translate into meaningful moves. "We have been here before, where we have seen positive talk. It's possible they will be able to do a smaller deal around tariffs, where there is some room for movement," said Mike Bell, global market strategist at J.P. Morgan Asset Management.


Sterling jumped nearly 2% versus the dollar for a second day, putting it on track for its largest weekly gain in more than two years after the EU Brexit negotiator reported a "constructive" meeting with his British counterpart.

Sterling was last trading at $1.2657, up 1.74%. Stocks on Wall Street followed Asia and Europe, with the S&P 500 on track for its largest daily gain in at least two months.

"Over the last couple of months, we have seen (companies)taking a hit from the uncertainty around trade and markets will be looking for any clues to remove that," said Scott Brown, chief economist at Raymond James in St. Petersburg, Florida. "It is still going to be a one step forward, two steps backward tone with the (trade) talks, but there are hopes of a de-escalation."

The Dow Jones Industrial Average rose 390.17 points, or 1.47%, to 26,978.38, the S&P 500 gained 50.51 points, or 1.72%, to 2,988.64 and the Nasdaq Composite added 157.94 points, or 1.99%, to 8,108.73. The pan-European STOXX 600 index rose 2.31% and MSCI's gauge of stocks across the globe gained 1.77%.

Emerging market stocks rose 1.82%. MSCI's broadest index of Asia-Pacific shares outside Japan closed 1.81% higher, while Japan's Nikkei rose 1.15%. The Federal Reserve said it would begin buying about $60 billion per month in Treasury bills to ensure "ample reserves" in the banking system, a program that will continue at least until the second quarter of 2020.

The dollar fell toward its session lows after the Fed announcement. The dollar index fell 0.38%, with the euro up 0.31% to $1.1038.

The Japanese yen weakened 0.46% versus the greenback at 108.50 per dollar as its global safe-haven luster faded. In commodities, oil prices rose after Iranian media said a state-owned oil tanker had been attacked in the Red Sea near Saudi Arabia, raising the prospect of supply disruptions, but bearish oil demand forecasts are seen keeping a lid on gains.

U.S. crude rose 2.35% to $54.81 per barrel and Brent was last at $60.58, up 2.5% on the day. The Fed announcement triggered a steepening of the U.S. yield curve, with the spread between 10-year and three-month yields on track to end the session in positive territory for the first time since May.

Benchmark 10-year notes last fell 29/32 in price to yield 1.7552%, from 1.656% late on Thursday. The 2-year note last fell 6/32 in price to yield 1.6199%, from 1.53% late on Thursday.



New farm bills in India: Focusing on farms or farmers?

... ...

Kenya’s COVID-19 response: Chaos amid lack of information

Confusing numbers and scanty information on how effective curfews and lockdowns have been in breaking transmission have amplified coordination and planning challenges in Kenyas response to COVID-19. Without accurate data, it is impossible t...

Farkhad Akhmedov: Calculating the price of impunity from the law

In insistences such as the battle over the Luna, Akhmedov has resorted to extreme legal machinations to subvert the High Courts decision and keep his assets from being seized. ...

Guinea’s elections hearken back to the autocracy and violence of its past

... ...


Latest News

IPL 13: Head coach Katich pleased with RCB's 'ruthless performance' against KKR

Royal Challengers Bangalore RCB thrashed Kolkata Knight Riders KKR on Wednesday and head coach Simon Katich was pleased with the teams ruthless performance. With this win, RCB has gone to the second position in the points table with 14 poin...

Ukraine reports daily record of 7,053 coronavirus cases

Ukraine registered a daily record of 7,053 COVID-19 cases, the national security council said on Thursday, up from a previous record of 6,719 on Wednesday.The total number of cases climbed to 322,879. The council said 116 new coronavirus-re...

New German coronavirus cases rise by more than 10,000 for first time - RKI

The number of confirmed coronavirus cases in Germany rose by more than 10,000 in a single day for the first time, data from the Robert Koch Institute RKI for infectious diseases showed on Thursday.The institute recorded 11,287 new cases in ...

Former Telangana Home Minister Narasimha Reddy dead

Senior TRS leader and former Home Minister of Telangana Nayani Narasimha Reddy died here on Thursday. He was 76.Reddy, who served as the first Home Minister of Telangana after its formation in 2014, had been undergoing treatment at a privat...

Give Feedback