Left Menu
Development News Edition

GLOBAL MARKETS-European shares recover, but trade worries mount

Reuters | Updated: 16-05-2019 23:00 IST | Created: 16-05-2019 17:25 IST
GLOBAL MARKETS-European shares recover, but trade worries mount
Image Credit:

European stocks rose half a percent to the day's highs on Thursday, erasing earlier losses, while the euro gained in volatile trade as the threat of auto tariffs were pushed back. But falling government bond yields globally meant attention remained focused on the trade dispute between China and the United States after Washington hit Chinese telecoms company Huawei with sanctions.

"Manufacturing growth in Europe continues to be a source of concern as seen by recent PMI data and unless we see a firm resolution on the trade war front, the uncertain outlook will continue to be a headwind for markets," said Mike Bell, a global markets strategist at JP Morgan Asset Management in London. European shares rose half a percent, up nearly a percent from the day's lows. German stocks also surged. U.S. stock futures were up 0.4 percent, signalling a stronger start on Wall Street.

The surge in European stocks and gains by Chinese and Hong Kong stocks pushed an index of global stocks into positive territory. German government bond yields were near their lowest in almost three years. Dutch bond yields were about to reach negative territory, a level not seen since October 2016. German yields are now four basis points below their Japanese counterparts, the biggest gap since late 2016.

Late on Wednesday, the U.S. Commerce Department said it was adding China's Huawei Technologies Co Ltd and 70 affiliates to its "Entity List" - a move that bans Huawei from acquiring components and technology from U.S. companies without government approval. The move surprised global markets, which had steadied the day before after Reuters reported that U.S. President Donald Trump was planning to delay tariffs on auto imports.

RATE CUT BETS GROW As trade tensions re-emerged, weak U.S. data ratcheted up market expectations of the Federal Reserve would cut U.S. interest rates this year. Retail sales unexpectedly fell in April and industrial production dropped 0.5%, the third decline this year. Yields on 10-year U.S. Treasury bonds fell to 2.3 %, near a 15-month low of 2.340% on March 28.

Fed funds rate futures are fully pricing in a rate cut by the end of this year and more than a 50% chance of a move by September. "That is a sea change from a year ago when the consensus was three to four rate hikes a year," said Akira Takei, bond fund manager at Asset Management One.

Falling U.S. yields have eroded support for the dollar, which was flat against a basket of other currencies. Oil prices gained on concern mounting tensions in the Middle East would hitting global supplies. Brent crude rose 0.1% to $72 a barrel and U.S. West Texas Intermediate (WTI) crude reached $62.73, half a percent higher.

Gold slipped 0.2% to $1,293.9 per ounce.



Rethinking Rural Livelihoods in the Times of COVID-19

The reverse migration caused by COVID 19 pandemic has put an additional burden of about one crore people on Indian villages particularly in the states of Uttar Pradesh, Bihar, Bengal and Odisha. Besides increasing the risk of spreading the ...

‘Discounted Deaths’ and COVID 19: Anthropology of Death and Emotions

Death is a social event rather than the mere cessation of biological functions. As seen by anthropologists, death is not just physical but intensely social, cultural, and political....

Indigenous knowledge of communities a must for maximizing impact of community work

Generally, it has been observed that the majority of the academicians in higher education institutions neglect the wisdom of community people and throw their weight around thinking that they know everything and the community knows nothing. ...

In rebuking FBR, Pakistan’s courts take a stand for public health

The system, if implemented effectively, will allow Pakistans revenue service to combat the illicit trade in tobacco products and potentially add hundreds of millions of dollars to the states budget each year. ...


Latest News

Militants in Burkina Faso kill 35 in separate attacks, govt says

Militants in Burkina Faso attacked a cattle market and a humanitarian convoy, killing at least 35 people, the government said on Sunday.Saturdays violence underscores deep instability in parts of Burkina Faso, which has been battling armed ...

Uttarakhand govt classifies Covid-19 districts into orange, red zones

The Uttarakhand government on Sunday categorized the districts under orange, red, and green zones to contain the COVID-19 in the state. The government has put Almora, Bageshwar, Chamoli, Champawat, Dehradun, Haridwar, Pauri Garhwal, Pithora...

43 deaths in UP in incidents related to rain, thunderstorm: State govt

Forty-three people have lost their lives in various incidents related to rain and thunderstorm in Uttar Pradesh on May 30, the state government said on Sunday. Chief Minister Yogi Adityanath has expressed grief over the loss of lives, and d...

Haryana to open interstate borders from June 1, places of worship from June 8

The Haryana government on Sunday issued fresh guidelines for the next phase of lockdown and decided to open its interstate borders, including those with Delhi from June 1 and places of worship, hotels and malls from June 8. Seeking to follo...

Give Feedback