New York (AFP) – Stock markets climbed on Monday, boosted by falling oil prices and positive signals from trade talks between Chinese and US officials over the weekend. Wall Street indices capped a buoyant day for global stocks with the Nasdaq piling on 2.3 percent to finish at a fresh record.
Stocks had come under pressure last week after the US Federal Reserve raised interest rates to curb inflation pressures, in part from soaring energy costs from the US-Israeli war against Iran. But with oil falling further on Monday, “the pressure cooker of worry about inflation is giving off less steam as crude prices have fallen back amid growing hopes that fresh negotiations could lead to a breakthrough in the Iran conflict,” said Susannah Streeter, chief investment strategist at Wealth Club.
Oil prices dropped around four percent on Monday after US President Donald Trump signaled he would be open to meeting with Iranian President Masoud Pezeshkian, who will travel to New York for the UN General Assembly this week. The benchmark international contract, Brent crude, briefly dropped under $100 per barrel. Florian Ielpo at Lombard Odier bank also noted that “Saudi exports rose to reach a little more than four million barrels per day in September compared to 2.4 million in August, while reports indicate that a part of the damaged East-West oil pipeline could reopen quickly.”
The drop in oil prices also “has helped drive a relief trade in sovereign bond markets that has afforded equity markets some relief,” said Patrick O’Hare at Briefing.com. Major Wall Street indices spent the entire day in positive territory, with chipmaker AMD emerging as the latest tech company to ride the artificial intelligence boom to a more than $1 trillion valuation.
In Europe, London closed the day with a gain of 0.8 percent, while Paris and Frankfurt both gained around one percent. Investors brushed off fresh political difficulties for German Chancellor Friedrich Merz, whose center-right CDU party suffered two regional election defeats at the hands of far-right and far-left parties.
US and Chinese economic officials met Sunday for closely watched talks on trade and artificial intelligence, ahead of a summit on Thursday between Trump and Chinese President Xi Jinping in Washington. US Treasury Secretary Scott Bessent said that after lengthy talks, the two countries had discussed setting up a channel called “US-China AI dialogue” to share information about the technology and its potential risks.
Hong Kong’s main index rose 1.2 percent Monday while shares in Shanghai rose one percent, and South Korea’s tech-heavy benchmark finished the day up 1.7 percent. Tokyo was closed for a public holiday. At the talks between Trump and Xi, “the area with the most potential to move markets is probably any Chinese cooperation on Iran, given recent oil and bond market volatility,” said Thomas Mathews of Capital Economics.
Streeter said that “there are hopes that the trade truce, which is due to expire on November 10, will be extended, and that potentially lower tariffs could be brokered.”
– Key figures at around 2020 GMT –
Brent North Sea Crude: DOWN 3.4 percent at $100.34 per barrel
West Texas Intermediate: DOWN 4.5 percent at $95.78 per barrel
New York – DOW: UP 0.7 percent at 52,048.83 (close)
New York – S&P 500: UP 1.5 percent at 7,764.70 (close)
New York – Nasdaq Composite: UP 2.3 percent at 27,122.09 (close)
London – FTSE 100: UP 0.8 percent at 10,739.01 (close)
Paris – CAC 40: UP 0.9 percent at 8,138.94 (close)
Frankfurt – DAX: UP 1.1 percent at 25,575.01 (close)
Hong Kong – Hang Seng Index: UP 1.2 percent at 25,042.71 (close)
Shanghai – Composite: UP 1.0 percent at 3,949.91 (close)
Tokyo – Nikkei 225: closed for a holiday
Dollar/yen: UP at 157.40 yen from 156.88 yen on Friday
Euro/dollar: DOWN at $1.1466 from $1.1486
Pound/dollar: DOWN at $1.3370 from $1.3395
Euro/pound: UP at 85.75 pence from 85.74 pence
© 2024 AFP
