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09 January 2019
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Financial Markets (The Total Investment & Insurance Solutions)
Share prices around the world surged further Wednesday amid hopes the
U.S. and China are on course to resolve their trade dispute following three
days of discussions in Beijing.
KEEPING SCORE: In Europe, Germany's DAX added 1.1 percent to 10,919
while the CAC 40 in France climbed 1.2 percent to 4,832. Britain's FTSE 100
jumped 1.1 percent to 6,935. Wall Street looked set for more gains, with Dow
futures and the broader S&P 500 futures up 0.2 percent.
CHINA-US TRADE: This week's buoyancy in stock markets has been largely
due to rising hopes of a resolution between the U.S. and China over their trade
dispute. After three days of discussion, President Donald Trump tweeted that
the talks had been "going very well!" a potential positive sign even
though no major developments had been announced. Experts say it may take months
to resolve the causes of the trade war, which include disagreements over
Beijing's handling of technology and intellectual property.
ANALYST TAKE: "The length and intensity of these talks seem to
portray a new, more resolute approach from both sides which raises hopes that
there could finally be some light at the end of the tunnel," said Joshua
Mahony, senior market analyst at IG. "It is unlikely that this week will
see any complete resolution to the differences between both sides, yet some
form of progress on the trade side of things would no doubt provide a further
boost for depressed markets."
FED MINUTES: Minutes to the last meeting of the Federal Reserve, at
which interest rates were raised again, will be of interest later in the
session. At the December meeting, the Fed's rate-setting panel reduced its
forecasts for the number of hikes this year from three to two. Markets have
gone further following recent comments from Fed Chairman Jerome Powell. Many
now think the Fed will stand pat for the rest of this year amid waning economic
growth and the slide in U.S. stocks.
ASIA'S DAY: Japan's Nikkei 225 index gained 1.1 percent to 20,427.06 and
Hong Kong's Hang Seng jumped 2.3 percent to 26,462.32. The Shanghai Composite
index surged 1.0 percent to 2,544.34 while South Korea's Kospi advanced 2.0
percent to 2,064.71.
ENERGY: Oil prices also continued to rally. U.S. crude rose $1.05 to
$50.83 per barrel in electronic trading on the New York Mercantile Exchange.
Brent crude, used to price international oils, added $1.06 to $59.78 per barrel
in London.
CURRENCIES: The euro was up 0.1 percent at $1.1456 while the dollar rose
0.1 percent to 108.91 yen.The Total
Investment & Insurance Solutions
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