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EUROPE-MARKETS
European stocks steady as Wall Street halts rout
LONDON, Dec 22, 2018 (BSS/AFP) – European stocks managed a late recovery
Friday to close steady, helped by an attempt in US markets to recover some of
the previous day’s sharp losses.
But political turbulence in Washington, renewed fears over US-China
relations and economic growth strains weighed on markets, with oil prices
testing lows not seen since the summer of 2017.
“It has been a remarkably terrible trading week for financial markets amid
concerns over rising US interest rates, decelerating global growth, Brexit
uncertainty and chaos in Washington,” said Lukman Otunuga, a research analyst
at FXTM.
US equities were mildly firmer in the late New York morning as they
struggled to claw back some of the two percent the Dow lost during a torrid
session Thursday — the latest losses in a bruising December that has set up
Wall Street for its worst year since the 2007 financial crisis.
Dow member Nike’s stock jumped after the company reported a 10.4 percent
increase in quarterly earnings.
London and Frankfurt posted slim gains at the close while Paris ended
unchanged as the prospect of an embarrassing Christmas time shutdown of the
US government loomed.
“A potential US government shutdown and US accusations of Chinese hacking
fuelled existing market concerns about economic growth,” said Michael
McCarthy, chief market strategist at CMC Markets and Stockbroking.
– ‘Well and truly over’ –
Rising tensions between the world’s two largest economies have also
unnerved markets, with China hitting back at the US after the Justice
Department indicted two alleged Chinese hackers accused of having ties to
Beijing’s security services.
US officials said the indictment showed President Xi Jinping had not
fulfilled his pledge to stop cybercrime, but it drew a furious response from
Beijing, which accused Washington of “fabricating facts”.
The row erupted as the two sides prepare for talks next month to resolve
their trade conflict.
Meanwhile US data showed Friday that Trump’s multi-front trade wars are
dragging down growth.
“The global rally in stocks seen in the past couple of years is now well
and truly over”, said David Cheetham at XTB, noting that London’s FTSE index
was seeing its worst December since 2002.
“But the question going forward is whether this is the start of a bear
market or simply a pause and period of consolidation,” he said.
Elsewhere Friday, Japanese stocks again bore the brunt of Asian losses,
with the Nikkei falling further into bear market territory to hit a fresh 15-
month low and regional shares on course for the worst week since October.
Nissan shares slipped 2.04 percent after former chairman Carlos Ghosn
faced a fresh allegations that could keep him in detention well into 2019.
BSS/AFP/HR/0948