LONDON, Nov 18 — Global stock markets mostly fell today as traders wondered when and how a US-China trade war will be resolved, prompting mild profit-taking after strong recent gains, dealers said.
Optimism over ongoing trade talks between the US and China had helped push US markets to new records last week, but “a deal has yet to be inked and whether the US will roll back tariffs on China remains a huge point of contention”, said analysts at the Charles Schwab brokerage.
“The bullish sentiment has cooled,” David Madden, market analyst at trading firm CMC Markets, summed up the Monday mood.
“The US-China trade story continues to be in focus, and we heard that ‘constructive’ discussions took place over the weekend — but the absence of detail has encouraged traders to take some cash off the table.”
On Wall Street, the Dow index sagged at the opening bell, matching losses in key eurozone markets, but London managed to eke out a small gain.
Earlier in Asia, Hong Kong stocks rallied after last week’s hefty losses but investors remain on edge over violent protests that have wracked the city. Elsewhere, Asian equities diverged.
‘Close communication’
Before the weekend, Wall Street’s Dow finished above 28,000 for the first time on Friday after top White House officials played up the progress of negotiations with Beijing.
US President Donald Trump’s economic adviser Larry Kudlow said the first part of a wider pact was on track, while Commerce Secretary Wilbur Ross said that there’ll be a deal “in all likelihood”.
Then on Saturday, China said Vice Premier Liu He had spoken to US Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin, and had “constructive discussion on each side’s core concerns regarding the phase-one agreement”.
It added that the two sides will “continue to maintain close communication”.
The comments provided a much-needed fillip after differences over whether, when and by how much to reduce tariffs on each other’s goods spilled out into the open.
Trump this month denied the Chinese commerce ministry’s claim that the two sides had agreed to roll back existing tariffs as part of the deal, details of which have not been released.
In foreign exchange markets, the pound extended gains on opinion polls showing a big lead for the ruling Conservative party ahead of next month’s general election, with traders hoping a clear victory will help Prime Minister Boris Johnson push through his Brexit deal.
Shares in Madrid stock exchange operator BME, meanwhile, were up nearly 38 per cent at €35.04 (RM161), in reaction to a bid by Swiss exchange SIX valuing BME at €34 per share.
The premium over the offer price reflected investor sentiment that Euronext, which earlier said it was talking to BME about a takeover, might swoop in with a hostile counter-offer.
Key figures around 1430 GMT
London — FTSE 100: UP 0.1 per cent at 7,307.48 points
Frankfurt — DAX 30: DOWN 0.6 per cent at 13,160.63
Paris — CAC 40: DOWN 0.5 per cent at 5,908.47
EURO STOXX 50: DOWN 0.5 per cent at 3,692.12
New York — Dow: DOWN 0.1 per cent at 27,977.88
Tokyo — Nikkei 225: UP 0.5 per cent at 23,416.76 (close)
Hong Kong — Hang Seng: UP 1.4 per cent at 26,681.09 (close)
Shanghai — Composite: UP 0.6 per cent at 2,909.20 (close)
Pound/dollar: UP at US$1.2961 from US$1.2901 at 2100 GMT
Euro/pound: DOWN at 85.35 pence from 85.67 pence
Euro/dollar: UP at US$1.1061 from US$1.1053
Dollar/yen: DOWN at 108.65 yen from 108.78 yen
Brent North Sea crude: UP 0.2 per cent at US$63.41 per barrel
West Texas Intermediate: UP 0.4 per cent at US$57.94
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© Agence France-Presse
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