🐂 Not all bull runs are created equal. November’s AI picks include 5 stocks up +20% eachUnlock Stocks

Risk rally pauses as markets await signals on trade

Published 11/06/2019, 07:25 AM
© Reuters. FILE PHOTO: The London Stock Exchange Group offices are seen in the City of London, Britain
EUR/USD
-
UK100
-
FCHI
-
AXJO
-
DE40
-
JP225
-
LCO
-
CL
-
STOXX
-
EU
-
MIAPJ0000PUS
-
CSI300
-
MIWD00000PUS
-
DXY
-

By Ritvik Carvalho

LONDON (Reuters) - Global stock markets steadied after a three-day rally on Wednesday as traders continued to watch incoming economic data and awaited new developments from U.S.-China trade talks.

MSCI's All Country World Index (MIWD00000PUS) was flat on the day, after rallying 1.3% since Friday.

World stock markets have rallied on a scaling-back of recession bets amid rising optimism about a U.S.-China trade deal this month and as global business surveys indicate tariff-hit manufacturing sentiment has troughed.

France's benchmark 10-year bond yield turned positive on Wednesday for the first time since July, in a further sign that entrenched pessimism in world bond markets is abating.

Investors said stock markets were consolidating gains made over the last three sessions as focus shifted to lingering concerns over the outcome of U.S.-China trade talks.

Traders and investors hope a preliminary Sino-U.S. trade pact will roll back at least some of the punitive tariffs that Washington and Beijing have imposed on each other's goods, but it is still uncertain when or where U.S. President Donald Trump will meet Chinese President Xi Jinping to sign the agreement.

Some suggested markets had already discounted a lot of good news.

"Optimism about a trade deal between the U.S. and China has given a lift to global equities," wrote Simona Gambrani at Capital Economics in a note to clients.

"But with a lot of good news already discounted and global economic growth likely to remain sluggish, we suspect that any further upside for stock prices will be limited."

European stocks edged higher, boosted by gains in financial stocks as investors assessed a mixed bag of earnings reports. The pan-European STOXX 600 index (STOXX) was higher by 0.1%. Britain's FTSE 100 (FTSE) index was flat, while Germany's DAX (GDAXI) and France's CAC 40 (FCHI) were up 0.2% and 0.3% each.

Incoming economic data continued to show signs of improvement.

German industrial orders rose more than expected in September, offering some hope for manufacturers in Europe's biggest economy as they head into the fourth quarter after a tough spell.

Euro zone business activity expanded slightly faster than expected last month but remained close to stagnation, according to a survey whose forward-looking indicators suggest what little growth there is could dissipate.

For an interactive version of the below chart, click here https://tmsnrt.rs/2qwDqWz.

Earlier in Asia, MSCI's broadest index of Asia-Pacific shares outside Japan (MIAPJ0000PUS) eased 0.2%. Australian shares (AXJO) were down 0.55%, Chinese stocks (CSI300) fell 0.45% and Japan's Nikkei stock index (N225) gained 0.2%.

In currencies, the dollar dipped against a basket of currencies, down 0.2%. (DXY) The euro was higher by 0.1% at $1.1088. (EUR=)

U.S. stock futures traded flat. (ESc1)

In an outcome that could offer clues as to how next year's U.S. presidential election may unfold, U.S. Democrats claimed an upset win in Kentucky on Tuesday and seized control of the state legislature in Virginia.

The pound traded flat at $1.2884.

A survey showed small British manufacturing firms are at their most pessimistic since just after the Brexit referendum in 2016 as they face political uncertainty at home and trade wars abroad.

Oil prices fell, pulled down by a larger-than-expected build in U.S. crude stocks, after gaining for three sessions on expectations of an easing in U.S.-China trade tensions. U.S. crude (CLc1) fell 0.17% to $57.13 per barrel and Brent crude (LCOc1) fell 0.44% to $62.68 per barrel.

© Reuters. FILE PHOTO: The London Stock Exchange Group offices are seen in the City of London, Britain

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.