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3 July 2018
 |
| Malaysia financial markets (The Total Investment & Insurance
Solutions) |
Global stock markets turned higher Tuesday as German leaders put to rest
fears that a weeks-long dispute on migration may topple Chancellor Angela
Merkel's fourth government.
KEEPING SCORE: Germany's DAX rose 1.2 percent to 12,385 and France's CAC
40 added 0.9 percent to 5,322. Britain's FTSE 100 gained 0.6 percent to 7,589.
Wall Street was poised to open higher. Dow and S&P 500 futures were both up
0.4 percent. U.S. markets are scheduled to close early ahead of Wednesday's
Independence Day holiday.
ASIA'S DAY: Asian markets tumbled in the morning as back-and-forth
exchanges over looming U.S. tariffs added to worries over the trade war brewing
between China and the U.S. Hong Kong's Hang Seng, reopening after a market
holiday on Monday, closed 1.4 percent lower at 28,545.57 as investors reacted
to weaker than expected Chinese economic data. The benchmark Nikkei 225 index
lost 0.1 percent to 21,785.54 while South Korea's Kospi added 0.1 percent to
2,272.76. The Shanghai Composite index gained 0.4 percent to 2,786.89.
Australia's S&P/ASX 200 rose 0.5 percent to 6,210.20 after the Reserve Bank
of Australia kept its 1.5 percent benchmark interest rate unchanged.
GERMAN MIGRANT DEAL: On Monday, Merkel and her rebellious political
allies reached a compromise on migration that both sides said addressed their
concerns. After five hours of talks, they agreed to establish "transit
centers" on Germany's border with Austria where asylum-seekers would be
evaluated and, if it turned out they already had applied for protection in
another EU country, sent back to that country. Merkel called the deal a
"very good compromise."
ANALYST'S TAKE: "The afternoon lift in Asia was reinforced by a
positive move in European stocks, led by the German market as a compromise
between Merkel and her interior minister on immigration eased fears of
political turmoil," said Eli Lee, head of investment strategy at the Bank
of Singapore.
TRADE TENSIONS: Investors continued to monitor trade tensions between
the U.S. and other major economies. The European Union on Monday slammed the
Trump administration for considering higher tariffs on auto imports, saying
they could lead to global retaliation against some $300 billion in U.S. goods.
President Donald Trump later said the World Trade Organization has treated the
U.S. "very badly" and the country will be "doing something"
if the organization doesn't change its ways. But he denied reports he plans to
pull out of the WTO.
CHINA TARIFFS: The U.S. will start imposing a 25 percent tariff on $34
billion worth of Chinese imports on Friday. It won't target 284 other items,
worth $16 billion, until it gathers further public comments. China is expected
to strike back with tariffs on a similar amount of U.S. exports. The Trump
administration is also identifying an additional $200 billion in Chinese goods
for 10 percent tariffs, which could take effect if Beijing retaliates.
GLENCORE SLIDE: Shares in Glencore, the world's biggest commodities
trader, were down about 10 percent after it said the U.S. Department of Justice
had requested documents to check on its compliance with corruption and money
laundering rules. The company says it is considering the request, which relates
to its operations in the Democratic Republic of Congo, Nigeria and Venezuela.
ENERGY: Oil futures recovered from the previous day's downtick, after
Trump claimed that Saudi Arabia could produce up to double of the 1 million
barrels-a-day increase agreed by OPEC countries. Benchmark U.S. crude added 85
cents to $74.79 a barrel in electronic trading on the New York Mercantile
Exchange. Brent crude, used to price international oils, gained 74 cents to
$78.04.
CURRENCIES: The dollar edged down to 110.83 yen from 110.87 yen in late
trading Monday. The euro rose to $1.1656 from $1.1639.The Total Investment & Insurance Solutions
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