Stock markets in Europe and the US slipped yesterday after several days of gains as investors took a breather in the absence of fresh news on trade talks between Beijing and Washington.
Earlier, Asian markets ended the week mostly on a higher note.
Key European markets were up to half a per cent lower at the close, while Wall Street was down around 0.3% approaching midday in New York.
In Europe, London’s FTSE 100 was down 0.4% to 6,918.18 points,
Frankfurt’s DAX 30 lost 0.3% to 10,887.46 and Paris’s CAC 40 was down 0.5% to 4,781.34 points at the close yesterday.
“US stocks are lower for the first day this week, paring a third-consecutive weekly advance that has come from lingering trade optimism and cooled concerns regarding the Fed making a policy mistake,” said analysts at Charles Schwab.
“Equities are slipping amid likely caution ahead of the ramp up of earnings season that coincided with the Q4 market tumult,” they said.
But analysts also said that the first full trading week of 2019 showed a solid performance after a tumultuous month of December for equities.
“Despite a lacklustre end to the week, 2019 has managed to get off to a decent start despite equity markets finishing 2018 very much on the back foot,” said Michael Hewson, chief market analyst at CMC markets UK.
This week investors have been riding a wave of optimism on signs that China and the United States could eventually reach a trade deal – but there has been no concrete news yet, although both sides indicated that talks had been productive.
“Traders have yet to hear any further details about the US-China trade talks,” said CMC markets UK analyst David Madden, saying in the meantime markets “appear to be taking a breather”.
Sentiment was also boosted this week after Federal Reserve chief Jerome Powell indicated the US central bank will likely slow the pace of interest rate hikes.
Fed minutes on Wednesday showed policymakers are happy to hold off any more rate hikes as they assess the state of the economy, backing up dovish comments last week by Powell.
There was a slight wobble in New York after Powell on Thursday suggested the central bank’s securities holdings should be “substantially smaller” – a sell-off by the Fed of such assets would likely lift money market rates.
But the general mood remained upbeat as a number of other top Fed officials indicated they were happy to see a break in hikes.
LEAVE A COMMENT Your email address will not be published. Required fields are marked*
Saudi vows quick recovery despite damage to oil plants
Trump dismisses ‘partial deal’ with China to end rift
Britain’s Thomas Cook scrambles for $251mn to avert collapse
Fed officials put their divisions over the state of US economy
Danske overtakes rival banks with shrewd debt-sale tactics
Sensex surges on fiscal stimulus
Stimulus-hooked China market traders shift focus to easy monetary conditions
Asian markets enjoy gains as focus turns back to trade talks
Hopes of US-China trade war resolution perk up European markets