Global shares bounce back after Wall Street sell-off

National Business

Global shares bounce back after Wall Street sell-off

By YURI KAGEYAMA AP Business Writer

May 24, 2019 02:31 AM


A currency trader walks near the screens showing the foreign exchange rates at the foreign exchange dealing room in Seoul, South Korea, Friday, May 24, 2019. Asian shares were mostly lower on Friday as worries that the standoff between the U.S. and China over trade might expand put investors in a selling mood.

Lee Jin-man

AP Photo


Global shares have bounced back following an overnight sell-off on Wall Street.

Britain’s FTSE 100 jumped 0.6% to 7,270.62 early Friday as Prime Minister Theresa May announced plans to resign as of June 7.

France’s CAC 40 added 0.8% to 5,324.03, while Germany’s DAX rose nearly 0.9% to 12,057.02.

U.S. shares also were set to drift higher, with Dow futures rising 0.6% to 25,611.00. S&P 500 futures added 0.6% to 2,837.20.

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May plans to step down as U.K. Conservative Party leader but stay on as caretaker prime minister until a new leader is chosen, a process likely to take several weeks. She bowed to relentless pressure from her party to quit over her failure to take Britain out of the European Union on schedule.

That diverted attention only briefly from the main preoccupation for the markets, trade friction between China and the U.S.

A suggestion by President Donald Trump that he expects to meet with his Chinese counterpart Xi Jinping at a summit next month in Japan raised hopes for progress in talks on the festering trade dispute between Beijing and Washington.

But in Asia, the mood was less upbeat.

Japan’s benchmark Nikkei 225 fell 0.2% to finish at 21,117.22. Australia’s S&P/ASX 200 lost 0.6% at 6,456.00. South Korea’s Kospi dropped 0.7% to 2,045.31.

Hong Kong’s Hang Seng edged 0.3% higher to 27,353.93, while the Shanghai Composite was little changed at 2,852.99.

“Finally, markets appear to be starting to price in the effect of an extended U.S.-China trade war on global growth,” Jeffrey Halley, senior market analyst at Oanda, said in a commentary.

Stocks ended sharply lower on Wall Street on Thursday in a broad sell-off that left the benchmark S&P 500 index on track for its third straight weekly loss and had the Dow Jones Industrial Average down more than 400 points until late afternoon.

Traders sought safety in the bond market, driving bond prices higher, which pulled the yield on the 10-year Treasury to 2.31%, the lowest level in more than a year. It was at 2.33% late Friday in Asia.

The stock market has been gyrating since Washington and Beijing escalated their dispute over trade earlier this month. Now, the two sides have broken off negotiations and appear set for a long standoff. Investors are concerned that a prolonged trade war could stunt economic growth and hurt corporate profits.

ENERGY: Benchmark U.S. crude rose 69 cents to $58.60 a barrel in electronic trading on the New York Mercantile Exchange. It plunged 5.7% to settle at $57.91 a barrel on Thursday. Brent crude, the international standard, added 80 cents to $68.56 per barrel.

CURRENCIES: The dollar fell to 109.59 Japanese yen from 109.60 yen on Thursday. The euro strengthened to $1.1183 from $1.1182.

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