FYI: Global stocks skidded on Friday, ending a recent rally after comments from Chinese officials suggested an uncertain course ahead for trade talks with the U.S.
In Europe, the pan-continental Stoxx Europe 600 fell 0.6% in midday trading, putting it on course to cap a three-session run of gains.
London’s FTSE 100 fell 0.4%, less than its counterparts in Frankfurt and Paris, as stocks were supported by a weaker British pound, which has fallen against the dollar all week amid growing Brexit uncertainty. The British currency and the country’s blue-chip index often move in opposite directions.
Chinese indexes led Asian markets lower, with the Shanghai Composite falling 2.5% and Hong Kong’s Hang Seng falling 1.1%. Japan’s Nikkei bucked the trend with a rise of 0.9%.
Trade tensions also prompted a slide in the Chinese yuan, which fell 0.4% against the dollar.
On Wall Street, futures pointed to opening drops for both the S&P 500 and the Dow Jones Industrial Average of 0.4%. The S&P 500 rose 0.9% Thursday, while the Dow climbed 0.8% as robust earnings helped offset economic growth concerns.
Investors also worried that Beijing could target U.S. tech companies in China after President Trump signed an executive order banning Chinese telecommunications firms.
The rising likelihood of national elections in the U.K. was also concerning European investors after Prime Minister Theresa May on Thursday set out plans for her resignation and bipartisan Brexit talks collapsed Friday. Investors suspect Mrs. May’s replacement would be more in favor of a disruptive exit from the European Union, something most economists warn would harm trade and the nation’s economy.
The British pound has fallen against the dollar for five-straight sessions this week as questions over Mrs. May’s succession have grown. It was last down 0.3% at $1.2766.
U.S. government bonds were little changed, with the yield on the benchmark 10-year Treasury note at 2.385%. The WSJ Dollar Index, which tracks the dollar against a basket of currencies, was also flat.
In commodities markets, Brent crude oil rose 0.7% to $73.10 a barrel, while gold fell 0.1% at $1,285 an ounce.
Regards,
Ted
WSJ:
https://www.wsj.com/articles/global-stocks-dip-as-trade-hopes-falter-11558079273Bloomberg:
https://www.bloomberg.com/news/articles/2019-05-16/stocks-in-asia-set-to-gain-as-u-s-rebound-grows-markets-wrap?srnd=premiumIBD:
https://www.investors.com/market-trend/stock-market-today/dow-jones-futures-pinterest-stock-nvidia-stock-applied-materials-stock-market-rally/Reuters:
https://www.reuters.com/article/us-global-markets/shares-swoon-as-beijing-ramps-up-war-of-words-idUSKCN1SN01DCNBC:
https://www.cnbc.com/2019/05/17/stock-market-investors-worry-rising-trade-tensions.htmlU.K.:
https://uk.reuters.com/article/uk-britain-stocks/ftse-100-drops-as-just-eat-rues-amazon-backing-rival-trade-worries-linger-idUKKCN1SN0PDEurope:
https://www.reuters.com/article/us-europe-stocks/european-shares-dragged-by-trade-rhetoric-idUSKCN1SN0SPAsia:
https://www.marketwatch.com/story/stocks-rally-in-japan-but-retreat-in-hong-kong-and-mainland-china-2019-05-16/printBonds:
https://www.cnbc.com/2019/05/17/bond-market-treasury-yields-tick-lower-as-trade-tensions-continue.htmlCurrencies:
https://www.cnbc.com/2019/05/17/forex-market-us-economic-data-euro-and-british-pound-in-focus.htmlOil:
https://www.cnbc.com/2019/05/17/oil-market-middle-east-tensions-opec-supply-decision-in-focus.htmlGold:
https://www.cnbc.com/2019/05/17/gold-market-us-dollar-us-economic-data-in-focus.htmlCuirrent Futures:
https://finviz.com/futures.ashx
