Stocks lose steam as trade hopes fade, euro dips after ECB

Traders work on the floor of the New York Stock Exchange in New York. — Reuters pic
Traders work on the floor of the New York Stock Exchange in New York. — Reuters pic

NEW YORK, Dec 13 ― A gauge of world gave up early gains and turned negative yesterday, continuing a pattern seen for the past several sessions, while the euro eased after the European ’s policy announcement.

In the United States, each of the major indexes were trading in negative territory as cautious trade optimism faded along with initial gains. Nervousness has heightened volatility in stocks recently with the S&P 500 closing on its lows in the prior session.

In Beijing, a commerce ministry spokesman said and the United States are in close contact over trade, and any US trade delegation would be welcome to visit.

Although signs of a trade thaw have been welcomed by investors, other worries have kept stocks from sustaining gains.

“Good news should make the market trade higher, there is just some overhang here,” said Mark Esposito, president of Esposito Securities in Dallas.

“The overhang concerns about earnings, recession and what the Fed is doing, it continues to take the wind out of the market each time in the past few weeks we’ve seen the market try to go up.”

The Dow Jones Industrial Average fell 36.28 points, or 0.15 per cent, to 24,490.99, the S&P 500 lost 11.64 points, or 0.44 per cent, to 2,639.43 and the Nasdaq Composite dropped 55.77 points, or 0.79 per cent, to 7,042.54.

US economic data showed initial claims fell last week to near 49-year lows, while import prices dropped as the cost of petroleum products tumbled.

Shares in Europe edged lower to snap a two-session win streak, as concerns about Britain’s exit from the European Union and euro-zone growth outweighed a budget compromise in Italy.

The pan-European STOXX 600 index lost 0.17 per cent and MSCI’s gauge of stocks across the globe shed 0.17 per cent.

Britain’s weakened prime minister, Theresa May, survived a late night no-confidence vote, and then said she did not expect a quick breakthrough in Brexit talks that would help get the deal through parliament.

The European Central Bank officially ended its post-crisis asset purchase program but promised to keep feeding stimulus into an economy struggling with an unexpected slowdown and political turmoil.

The euro and sterling were choppy on Brexit uncertainty and in the wake of comments from ECB President Mario Draghi following a central bank announcement investors viewed as dovish.

The dollar index rose 0.03 per cent, with the euro down 0.05 per cent to US$1.1362 (RM4.7498).

Sterling, rebounding from earlier declines, was last trading at US$1.2651, up 0.17 per cent on the day.

Oil prices were higher after data showed inventory declines in the United States and as investors began to expect the global could have a deficit sooner than previously thought.

US crude rose 2.8 per cent to US$52.58 per barrel and was last at US$61.43, up 2.13 per cent. ― Reuters

Source: The Malay Mail Online

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