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Stock markets wobble ahead of key G20 talks, Boeing slumps
NEW YORK, June 28, 2019 (BSS/AFP) – World stock markets wobbled on
Thursday ahead of key US-China trade talks at the Group of 20 summit, while
Boeing shares took a hit on expectations that the 737 MAX will remain out of
service for even longer than expected.
Equity markets in Asia rose, while European and US stocks were mixed as
leaders gathered for the two-day G20 summit in Osaka, Japan, which opens on
Friday.
Investors largely shrugged off the latest verbiage surrounding the long-
anticipated talks, taking in stride a Wall Street Journal report that said
Chinese President Xi Jinping plans to demand that US President Donald Trump
rescind a ban on doing business with Huawei as among the conditions of
relaunching formal negotiations.
White House economic advisor Larry Kudlow dismissed the report, saying
“there are no preconditions to these talks.”
Analysts said the market could rally if the talks conclude on a
constructive note.
“There have been conflicting and confusing reports as to exactly where the
two sides stand ahead of the G20 and more importantly a side-line meeting
between Trump and Xi Jinping,” said Fiona Cincotta, a senior market analyst
at City Index.
“The overall sensation in the market is that something positive will come
out of this weekend, even if a renewed vow to keep talking,” she said.
Adam Sarhan of 50 Park Investments said investors have been cautious ahead
of the talks.
“If we have a positive outcome we could see a scenario where stocks
rally,” Sarhan said. “They don’t need necessarily to find a deal.”
Trade is also expected to feature heavily as a point of conflict in the
wider G20 meeting with battles likely over the wording of the final statement
— if the leaders can agree to one.
In other markets, oil prices edged higher, while bitcoin plunged more than
$3,000 after recent surges, once more emphasizing the volatility of
cryptocurrencies.
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Among individual companies, Boeing sank 2.9 percent after the Federal
Aviation Administration uncovered a new issue with the 737 MAX that could
further push back the timetable to return the plane to the sky after two
deadly crashes.
The issue, identified during simulator testing, concerns a problem with a
microprocessor that impedes the ability of pilots to quickly reassert control
of the plane after having activated the Maneuvering Characteristics
Augmentation System (MCAS), according to two people familiar with the issue.
Boeing said it agrees with FAA’s decision and would work to address the
problem. Neither the FAA or Boeing offered a time-table for a fix, but a
Bloomberg report citing unnamed sources said it could require up to three
months to address the issue.
– Key figures around 2050 GMT –
New York – Dow: DOWN less than 0.1 percent at 26,526.58 (close)
New York – S&P 500: UP 0.4 percent at 2,924.92 (close)
New York – Nasdaq: UP 0.7 percent at 7,967.76 (close)
London – FTSE 100: DOWN 0.2 percent at 7,402.33 (close)
Paris – CAC 40: DOWN 0.1 percent at 5,493.61 (close)
Frankfurt – DAX 30: UP 0.2 percent at 12,271.03 (close)
EURO STOXX 50: FLAT at 3,442.38 (close)
Tokyo – Nikkei 225: UP 1.2 percent at 21,338.17 (close)
Hong Kong – Hang Seng: UP 1.4 percent at 28,621.42 (close)
Shanghai – Composite: UP 0.7 percent at 2,996.79 (close)
Euro/dollar: UP at $1.1370 from $1.1369 at 2100 GMT
Pound/dollar: DOWN at $1.2669 from $1.2690
Dollar/yen: DOWN at 107.78 yen from 107.79
Brent North Sea crude: UP 6 cents at $66.55 per barrel
West Texas Intermediate: UP 5 cents at $59.43 per barrel
Bitcoin – DOWN at $10,305 from $13,698
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