NEW YORK, Aug 10, 2019 (BSS/AFP) – Global stocks fell Friday on worries
about the grinding US-China trade war amid rising gloom over the global
growth outlook.
Leading bourses in Europe lost more than one percent, including in Milan
after Italian Interior Minister Matteo Salvini pulled support for the
government coalition and called for snap elections while parliament was on
summer recess.
Wall Street stocks dove after US President Donald Trump said he might
cancel trade talks with China scheduled for September and that the US would
not do business with Chinese tech company Huawei.
US equities later staged a partial rebound due to bargain-hunting, but
finished the day and week lower.
“The trade back and forth between the US and China is huge on the market,”
said FTN Financial’s Chris Low, who also cited heightened recession risk as a
drag on stocks.
In other markets, the British pound fell to fresh lows after Britain
reported its first economic contraction in nearly seven years, while oil
prices rallied on talk Saudi Arabia will move to boost oil prices.
Relations between the US and China have soured further in the past week
after Trump announced a new round of punitive tariffs on Chinese goods,
despite a truce agreed with President Xi Jinping in May, and Beijing
responded by halting all purchases of US agricultural goods.
The US Treasury then declared China a currency manipulator, after the yuan
lost value in the face of the new round of tariffs due to take effect
September 1.
Economists have warned that the protracted trade war would weigh on global
growth, an outcome also suggested by other data Friday.
Fresh data showed a massive slump in German exports in June compared with a
year ago, rounding off a run of weak data pointing to a shaky second quarter.
Official British data released Friday showed the country’s gross domestic
product (GDP) fell 0.2 percent in the second quarter, the first time it has
contracted in almost seven years.
Another decline in the third quarter would put Britain in recession ahead
of the nation’s expected withdrawal from the EU on October 31.
“All in all, today’s disappointing GDP figure is set to raise alarm bells
over Brexit dragging the UK economy deeper into the abyss,” said Lukman
Otunuga, senior research analyst at FXTM.
– Key figures around 2055 GMT –
New York – Dow: DOWN 0.3 percent at 26,287.44 (close)
New York – S&P 500: DOWN 0.7 percent at 2,918.66 (close)
New York – Nasdaq: DOWN 0.1 percent at 7,959.14 (close)
London – FTSE 100: DOWN 0.4 percent at 7,253.85 (close)
Frankfurt – DAX 30: DOWN 1.3 percent at 11,693.80 (close)
Paris – CAC 40: DOWN 1.1 percent at 5,327.92 (close)
Milan – FTSE MIB – DOWN 2.5 percent at 20,324.23 (close)
EURO STOXX 50: DOWN 1.2 percent at 3,333.74 (close)
Tokyo – Nikkei 225: UP 0.4 percent at 20,684.82 (close)
Hong Kong – Hang Seng: DOWN 0.7 percent at 25,939.30 (close)
Shanghai – Composite: DOWN 0.7 percent at 2,774.75 (close)
Euro/pound UP at 93.09 pence from 92.15 pence around 2100 GMT
Pound/dollar: DOWN at $1.2034 from $1.2133
Euro/pound: UP at 93.08 pence from 92.15 pence
Euro/dollar: UP at $1.1202 from $1.1180
Dollar/yen: DOWN at 105.62 yen from 106.06 yen
Brent North Sea crude: UP 2% at $58.53 per barrel
West Texas Intermediate: UP 3.7% at $54.50 per barrel