Stocks fall on trade war jitters, pound slides on Brexit

A currency trader walks by the screen showing the Korea Composite Stock Price Index (KOSPI) at the foreign exchange dealing room in Seoul, South Korea, Tuesday, Sept. 3, 2019. Asian stock markets were mostly lower Tuesday after investor jitters over U.S.-Chinese trade tension were revived by a report negotiators cannot agree on a schedule for talks this month. (AP Photo/Lee Jin-man)

By JOE McDONALD AP Business Writer

BEIJING (AP) — Global stock markets were mostly lower Tuesday amid revived jitters over U.S.-Chinese trade tension, while wrangling by British lawmakers over whether to try to postpone Brexit saw the pound fall further.

Benchmarks in London, Frankfurt and Hong Kong declined. Shanghai closed lower and Tokyo was little changed while traders on Wall Street were poised for selling when the markets open.
Investor optimism about U.S.-Chinese talks this month aimed at ending a tariff war was shaken by a Bloomberg News report that trade envoys were struggling to agree on a schedule.

Markets had reacted less strongly to last weekend’s U.S. and Chinese tariff hikes in a fight over trade and technology. On Sunday, the United States started charging a 15% tariff on about $112 billion of Chinese products. China responded by charging tariffs of 10% and 5% on a list of American goods.

The report is a reminder “of the tremendous gulf between the U.S. and China in reconciling their differences over trade, leaving the global economy hanging in the balance,” Han Tan of FXTM said in a report.

Meanwhile, Britain’s Parliament was due to reconvene after Prime Minister Boris Johnson’s office said he would call an early election if his opponents pass legislation that would block his plans to leave the EU by an Oct. 31 deadline.

Opposition parties are challenging Johnson’s plan to withdraw from the European market of 500 million people even if the two sides haven’t agreed on terms for future trade and travel.
In early trading, London’s FTSE 100 was off 3 points at 7,258 as the pound fell to its lowest level since 1985, excluding a brief crash it suffered in 2016. Frankfurt’s DAX lost 0.3% to 11,913 and France’s CAC 40 retreated 0.4% to 5,471.

On Wall Street, the future for the benchmark Standard & Poor’s 500 index was off 0.6% with trading due to resume after a three-day weekend. That for the Dow Jones Industrial Average was down 0.7%.

In Asia, the Shanghai Composite Index closed up 0.2% at 2,930.15 and Tokyo’s Nikkei 225 was 5 points higher at 20,625.16. Hong Kong’s Hang Seng gained 0.4% to 25,527.85.
Seoul’s Kospi shed 0.2% to 1,965.69 and Sydney’s S&P-ASX 200 lost 1.5% to 6,573.40. India’s Sensex fell 1.6% to 36,731.51.

AUSTRALIAN RATES: The Reserve Bank of Australia held its benchmark interest rate steady at 1% at its September board meeting. A bank statement cited risks to global growth from the U.S.-Chinese tariff war and uncertainty over Australian consumer spending.

ENERGY: Benchmark U.S. crude lost $1 cents to $54.10 per barrel in electronic trading on the New York Mercantile Exchange. The contract fell $1.61 on Monday to close at $55.10. Brent crude, used to price international oils, retreated 86 cent to $57.80 per barrel in London. It sank 69 cents the previous session to $58.66.

CURRENCY: The dollar retreated to 106.12 yen from Monday’s 106.22 yen. The euro declined to $1.0933 from $1.0969.

News Desk
Author: News Desk

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