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STOCK-MARKETS-WORLD WRAP
Stock markets slump as Trump lashes out at China
LONDON, July 30, 2019 (BSS/AFP) – Stock markets on both sides of the Atlantic
fell on Tuesday after US President Donald Trump lashed out at Beijing just as
trade talks resumed, dealers said.
The British pound, meanwhile, continued its slide to fresh two-year lows as
more investors were betting on a no-deal Brexit.
Trump ripped into China after US negotiators arrived in Shanghai to
resurrect talks aimed at ending a year-long trade war between the world’s two
top economies.
“My team is negotiating with them now, but they always change the deal in
the end to their benefit,” Trump tweeted.
– ‘Off the handle’ –
Investors reacted by pulling out of equities in anticipation of worse to
come.
“President Trump sends equity markets reeling, yet again,” said Stephen
Innes, at SPI Asset Management.
“Whatever shred of optimism markets had about the ongoing trade
negotiations were dealt a severe blow when President Trump flew off the
handle again at China for not buying American agricultural products,” he
said.
Renewed jitters over trade compounded a cocktail worries already weighing
on stocks, said Fawad Razaqzada, market analyst at Forex.com.
US markets were also lower in early Wall Street business, but appeared more
resilient than their European counterparts.
– Fed anticipation ‘palpable’ –
Frankfurt’s benchmark DAX 30 index tumbled in the afternoon deals, with
German airline Lufthansa slumping after weak profits.
Paris was hurt by figures showing France’s economy stagnated in the second
quarter, growing by a meagre, and lower-than-forecast, 0.2 percent.
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London’s FTSE 100 index outperformed eurozone markets as the weak pound
lifted UK-based multinationals who sell their goods abroad.
Both the US Federal Reserve and the Bank of England are slated on Thursday
to announce the outcomes of their latest monetary policy gatherings.
Expectations are that the Fed could deliver the first interest rate cut in a
decade.
“As we get closer to the Fed decision, the sense of anticipation in markets
is almost palpable,” said analyst Chris Beauchamp at spread-betting firm IG.
– Pound plumbs new lows –
Meanwhile, the Brexit-hit pound continued to suffer as expectations grew
of a no-deal British withdrawal from the European Union in October.
In Asian trading, sterling sank as low as $1.2119 — a level last seen in
March 2017, before clawing back some ground.
“Prime Minister Boris Johnson said he had no intention of meeting EU
leaders in person until they showed a willingness to change their position on
the Irish backstop and withdrawal agreement,” said CMC Markets chief analyst
Michael Hewson.
“This hard line, so late in the day, appears to have prompted a sudden
realisation that a no-deal Brexit has suddenly become a much more likely
event.”
– Key figures around 1340 GMT –
London – FTSE 100: DOWN 0.2 percent at 7,667.19
Frankfurt – DAX 30: DOWN 2.2 percent at 12,150.53 points
Paris – CAC 40: DOWN 1.5 percent at 5,514.51
EURO STOXX 50: DOWN 1.6 percent at 3,465.13
New York – Dow: DOWN 0.4 percent at 27,119.34
Pound/dollar: DOWN at $1.2171 from $1.2219 at 2100 GMT
Euro/pound: UP at 91.58 pence from 91.21 pence
Euro/dollar: UP at $1.1148 from $1.1145
Dollar/yen: DOWN at 108.56 yen from 108.78
Tokyo – Nikkei 225: UP 0.4 percent at 21,709.31 (close)
Hong Kong – Hang Seng: UP 0.1 percent at 28,146.50 (close)
Shanghai – Composite: UP 0.4 percent at 2,952.34 (close)
Brent North Sea crude: UP 48 cents at $64.10 per barrel
West Texas Intermediate: UP 34 cents at $57.21
BSS/AFP/SR/2010 HRS