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Trade woes drag down European stocks
NEW YORK, June 29, 2018 (BSS/AFP) – Trade war worries permeated European
stock markets on Thursday, eating into the previous day’s hard-won gains as
mixed signals from the White House fueled uncertainty.
Focus was also on Brussels, where EU leaders facing deep divisions on
migration met for a summit that the embattled German Chancellor Angela Merkel
said could decide the fate of the bloc itself.
Escalated trade concerns were “continuing to hamper sentiment and drain
conviction”, said Charles Schwab analysts.
“The recovery in the stock markets could not last long,” said Fawad
Razaqzada, a market analyst at Forex.com.
Trade fears were being compounded by expectations that borrowing costs
will steadily rise worldwide, causing investors to feel “downbeat,” he added.
Key eurozone indices were one percent or more lower at the close, while
London ended the day just a touch weaker.
Trade war worries also continued to weigh on Wall Street, but US stocks
shook off early weakness and finished the session solidly higher.
Analysts pointed to gains by US financial sector stocks that have
underperformed in recent sessions and stand to benefit as investors rebalance
portfolios at the end of the second quarter.
Concerns about the Chinese economy are adding to a knock in confidence,
with the yuan continuing to weaken and mainland stocks now in bear market
territory having fallen more than 20 percent from recent highs.
– Get used to it –
“Once again, European indices are trading in the red,” noted Craig Erlam,
senior market analyst at Oanda trading group.
“We may have to get used to this risk averse environment in the near-
term,” he added.
Dealers are struggling to get a handle on the situation owing to confusion
over US President Donald Trump’s trade strategy.
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“There’s a lot of uncertainty out there,” said William Lynch of Hinsdale
Associates. “We are not getting anything concrete from the administration in
terms of what it intends to do.”
Leading pharmacy chains tumbled on news that Amazon acquired online
pharmacy PillPack for terms that were undisclosed in its biggest move yet
into healthcare.
CVS Health fell 6.1 percent, Walgreens Boots Alliance dropped 9.9 percent
and Rite Aid declined 11.1 percent. Amazon jumped 2.5 percent.
Neil Saunders of the research firm GlobalData Retail, said the Amazon
acquisition “is a warning shot” for the pharmacy sector.
– Key figures around 2030 GMT –
New York – Dow Jones: UP 0.4 percent at 24,216.05 (close)
New York – S&P 500: UP 0.6 percent at 2,716.31 (close)
New York – Nasdaq: UP 0.8 percent at 7,503.68 (close)
London – FTSE 100: DOWN 0.1 percent at 7,615.63 (close)
Frankfurt – DAX 30: DOWN 1.4 percent at 12,177.23 (close)
Paris – CAC 40: DOWN 1.0 percent at 5,275.64 (close)
EURO STOXX 50: DOWN 1.1 percent at 3,361.48 (close)
Tokyo – Nikkei 225: FLAT at 22,270.39 (close)
Hong Kong – Hang Seng: UP 0.5 percent at 28,497.32 (close)
Shanghai – Composite: DOWN 0.9 percent at 2,786.90(close)
Euro/dollar: UP at $1.1564 from $1.1554 at 2100 GMT
Pound/dollar: DOWN at $1.3076 from $1.3113
Dollar/yen: UP at 110.53 yen from 110.26 yen
Oil – Brent Crude: UP 23 cents at $77.85 per barrel
Oil – West Texas Intermediate: UP 69 cents at $73.45 per barrel
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