Global stocks sag amid trade uncertainty, oil prices fall

Oil prices slumped after data pointed to a jump in US stockpiles, exacerbating worries about oversupply and weakening demand growth. — Reuters pic
Oil prices slumped after data pointed to a jump in US stockpiles, exacerbating worries about oversupply and weakening demand growth. — Reuters pic

NEW YORK, June 13 — Stock markets pulled back yesterday amid lingering trade war worries, with Asian markets also buffeted by unease over massive civil protests in Hong Kong.

Asian markets kicked off the losses after two days of healthy gains, with Hong Kong the worst performer — sinking two per cent as a huge anti-government protest paralysed key roads in the city before turning violent.

European indices followed suit with losses of around half a per cent by the close, while Wall Street, having opened steady, slid gently downwards. The broad-based S&P 500 ended down 0.2 per cent.

“The market is concerned about the US economic growth, global growth, and the tariffs issue,” said Quincy Krosby, chief market strategist of Prudential Financial.

Krosby said investors are also somewhat less hopeful that the Federal Reserve will cut interest rates soon, after the United States withdrew a plan to impose tariffs on Mexico.

Profit-takers moved in also as traders keep a nervous eye on developments in the China-US trade saga ahead of a possible meeting between Donald Trump and his Chinese counterpart Xi Jinping at the Group of 20 summit in Japan later this month.

Oil prices slumped after data pointed to a jump in US stockpiles, exacerbating worries about oversupply and weakening demand growth.

“Oil prices have struggled to retain (recent) bullish gains as traders stay cautious over heightened geopolitical risks and persistent weakness in the global economic backdrop,” said Benjamin Lu, commodities analyst with Phillip Futures in Singapore.

Lu and other analysts said oil prices had been winning support from expectations that the Organisation of the Petroleum Exporting Countries and Russia would agree at a meeting this month to extend output cuts beyond June.

Elsewhere in commodities, cocoa futures rose sharply after key producers Ivory Coast and Ghana stopped sales in a push for higher prices, dealers said.

The September forward contract for the commodity, listed in New York, reached an 11-month high, hitting US$2,545 (RM10,583.64), a rise of around 1.6 per cent on the day.

The two African nations, which together account for 60 per cent of the world’s cocoa production, summoned buyers to Accra demanding a price of US$2,600 per ton.

The meeting reached agreement in principle, a Ghana official announced, but implementation remains an issue.  — AFP