New York (AFP) – European and US stock markets fell before recovering somewhat as markets weighed trade tensions between Beijing and Washington and digested fresh Federal Reserve commentary. Wall Street indices opened firmly in the red amid the latest back and forth involving the United States and China on trade.
But US stocks recovered somewhat following midday remarks from Fed Chair Jerome Powell. Powell’s observation that US payroll gains have “slowed sharply” strengthened confidence the US central bank would cut interest rates later this month. “In this less dynamic and somewhat softer labor market, the downside risks to employment appear to have risen,” Powell said.
While two of the three major US indices still finished in the red, the broad-based S&P 500 shed just 0.2 percent at 6,644.31, about 90 points above its session low. Bourses earlier in Europe had also struggled to get out of the red, while Asian markets suffered losses following Monday’s pullback in the wake of US-China tensions.
“There is a whiff of risk aversion about financial markets today,” said Kathleen Brooks, research director at XTB. “The global stock market uptrend is facing a little more resistance on the upside.” Markets were unsettled after China imposed sanctions on five American subsidiaries of South Korean shipbuilder Hanwha Ocean, accusing them of supporting a US government investigation into the shipping industry.
In Europe, eyes were on embattled French Prime Minister Sebastien Lecornu as he presented a cost-cutting budget to a divided parliament, with parties on both ends of the political spectrum already trying to topple his government. Paris ended down just 0.2 percent, but among individual shares, tire maker Michelin plunged almost nine percent after it revised downward its revenue expectations in North America, where its activities have been hit by tariffs. It later recovered to close down 2.6 percent.
Earlier, Tokyo slumped more than two percent as the country’s top opposition parties sought to find a unified candidate for prime minister and oust the ruling party from power after the ruling coalition collapsed last week, putting in peril Sanae Takaichi’s bid to become the country’s first woman prime minister.
Back in New York, JPMorgan Chase finished down 1.9 percent despite reporting higher profits in results that topped analyst expectations. However, the bank disclosed a $170 million hit from its exposure to Tricolor, a subprime auto lending company that went bankrupt. Goldman Sachs also dropped 2.0 percent after reporting higher profits, but Citigroup jumped 3.9 percent and Wells Fargo surged 7.2 percent.
– Key figures at around 2030 GMT –
New York – Dow: UP 0.4 percent at 46,270.46 (close)
New York – S&P 500: DOWN 0.2 percent at 6,644.31 (close)
New York – Nasdaq: DOWN 0.8 percent at 22,521.70 (close)
London – FTSE 100: UP 0.1 percent at 9,452.77 points (close)
Paris – CAC 40: DOWN 0.2 percent at 7,919.62 (close)
Frankfurt – DAX: DOWN 0.6 percent at 24,236.94 (close)
Tokyo – Nikkei 225: DOWN 2.6 percent at 46,847.32 (close)
Hong Kong – Hang Seng Index: DOWN 1.7 percent at 25,441.35 (close)
Shanghai – Composite: DOWN 0.6 percent at 3,865.23 (close)
Euro/dollar: UP $1.1604 from $1.1570 on Monday
Pound/dollar: DOWN at $1.3319 from $1.3333
Dollar/yen: DOWN at 151.74 yen from 152.28 yen
Euro/pound: UP at 87.13 pence from 86.77 pence
Brent North Sea Crude: DOWN 1.5 percent at $62.39 per barrel
West Texas Intermediate: DOWN 1.3 percent at $58.70 per barrel
© 2024 AFP
