Stocks rebound on China trade deal indication, bonds fall

Traders work on the floor at the New York Stock Exchange April 4, 2019. — Reuters pic
Traders work on the floor at the New York Stock Exchange April 4, 2019. — Reuters pic

NEW YORK, May 8 — A gauge of world rose and safe-haven prices fell today after the White House said it had received an indication from that it wanted to make a trade deal with the United States that had appeared on the brink of unravelling.

prices earlier hit their highest in more than three weeks as the trade row’s potential impact on curbed the appetite for risk. The dollar eased as investors raised expectations of a US interest rate cut later this year.

The United States will raise tariffs to 25 per cent from 10 per cent on US$200 billion worth of imports effective Friday, according to a notice posted to the Federal Register.

White House spokeswoman Sarah Sanders later said the United States has received an indication from China that Beijing wants to make a trade deal.



Trade delegations from Washington and Beijing are scheduled to begin their latest round of talks tomorrow.

Stocks on rebounded as did major indices in Europe, while MSCI’s gauge of equity performance in 47 countries turned higher, adding 0.11 per cent.

Earlier in Asia, shares outside Japan closed 0.94 per cent lower and Japan’s Nikkei index lost 1.46 per cent.

Two weeks ago the market had viewed resolution of the Sino-US trade talks as a foregone conclusion and with it back on the table, volatility has picked up, said Yousef Abbasi, global market strategist at INTL FCStone Financial Inc in New York.

“People put on risk since late December and now they’re having to grapple with uncertainty on a topic they were almost certain about two weeks ago,” Abbasi said. “It puts you in a precarious position.”

The Dow Jones Industrial Average rose 93.89 points, or 0.36 per cent, to 26,058.98. The S&P 500 gained 9.73 points, or 0.34 per cent, to 2,893.78 and the Nasdaq Composite added 31.34 points, or 0.39 per cent, to 7,995.09.

Bond prices fell on the White House announcement, with the benchmark 10-year US Treasury note falling 2/32 in price to push up its yield to 2.4548 per cent.

The dollar remained lower. The dollar index fell 0.11 per cent, with the euro up 0.13 per cent to US$1.1204.



The Japanese yen strengthened 0.11 per cent versus the greenback at 110.15 per dollar.

Oil prices rallied.

US crude rose 1.4 per cent to US$62.26 per barrel and was last at US$70.51, up 0.9 per cent on the day. — Reuters

Source: The Malay Mail Online





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