Home / International/ Asia shares hobbled by trade strain, pound up on Brexit talk

Asia shares hobbled by trade strain, pound up on Brexit talk


Comments / {{hitsCtrl.values.hits}} Views / Wednesday, 12 September 2018 00:00

Facebook

SYDNEY (Reuters): Asian shares were struggling to avoid a ninth straight session of losses on Tuesday as the spectre of a further escalation in the Sino-US trade war haunted investors, while the pound perched at a five-week top on hints a Brexit deal might be nearer.

EMini futures for the S&P 500 edged up 0.15%, while financial spreadbetters pointed to small opening gains for the major European bourses.

Japan’s Nikkei fared better on the back of a softer yen and rallied 1.3%.

Weighing on the yen was news Japanese chipmaker Renesas was buying US peer Integrated Device Technology for about $6.7 billion in cash.

MSCI’s broadest index of Asia-Pacific shares outside Japan eased 0.05%, but did hold above lows last visited in July last year.

Shanghai blue chips dipped 0.2% while South Korea fell 0.2% as investors awaited the next round of trade hostilities.

Having warned last week that he was ready to levy additional taxes on practically all Chinese imports, U.S. President Donald Trump was uncharacteristically quiet on trade on Monday.

China has cautioned it will respond if the United States takes any new steps on trade.

Canadian Foreign Minister Chrystia Freeland will meet the U.S. Trade Representative in Washington on Tuesday for another round of talks to renew the NAFTA trade pact.

On Wall Street, the Nasdaq eked out gains to end four sessions of losses but stocks of insurers slipped as Hurricane Florence barreled toward the U.S. east coast.

The Dow fell 0.23%, while the S&P 500 gained 0.19% and the Nasdaq 0.27%.

Betting on Brexit

In currency markets, sterling stood out after the European Union’s top negotiator said an agreement for Britain to leave the economic bloc might be reached in the coming weeks.

The pound has been under pressure on anxiety that Britain would exit from the EU without any formal trading arrangement.

Sterling clambered up to $1.3050, after firming 0.8% overnight.

The euro inched ahead to $1.1610, but faces resistance at $1.1659. It was aided by an easing in concerns over Italian debt which left the gap between yields on Italian and more creditworthy German bonds at the narrowest in a month.

Against a basket of major currencies the dollar was 0.1% lower at 95.054. It did gain on the yen to 111.44, but remained within recent ranges.

Emerging market currencies remained under pressure with a broad index down near 16-month lows and the Indian rupee near a record trough of 72.675 per dollar,

“Weakness is set to remain a recurring theme amid global trade tensions, a broadly stronger dollar and prospects of higher US interest rates,” said Lukman Otunuga, a research analyst at broker FXTM.

“With turmoil in Turkey and Argentina triggering contagion fears, appetite for emerging market assets and currencies is likely to continue diminishing.”

In commodity markets, gold was stuck at $1,194.90 an ounce and continues to move in the opposite direction to the dollar.

Oil prices found support from looming US sanctions against Iran’s petroleum industry.

Brent was 25 cents firmer at $77.62 a barrel, while US crude inched up 10 cents to $67.64.


Share This Article

Facebook Twitter


DISCLAIMER:

1. All comments will be moderated by the Daily FT Web Editor.

2. Comments that are abusive, obscene, incendiary, defamatory or irrelevant will not be published.

3. We may remove hyperlinks within comments.

4. Kindly use a genuine email ID and provide your name.

5. Spamming the comments section under different user names may result in being blacklisted.

COMMENTS

Today's Columnists

Religion is a problem in Sri Lanka; can it be a solution?

Saturday, 17 August 2019

Generally, it is expected that religion should be a solution to a problem. Ironically in Sri Lanka religion is the problem. Therefore, what would be the solution? When religion becomes a problem of a country....


Orthodoxy and change: A perennial Muslim issue

Saturday, 17 August 2019

Whether Muslims live as minorities in non-Muslim countries or as majorities in a total of fifty seven countries, the clash of orthodoxy with modern challenges is a perennial issue that bedevils progress on several fronts in these communities.


Making the MCC Compact work for Sri Lanka

Friday, 16 August 2019

It is a sign of these political times that even an apolitical issue like a foreign aid program becomes a hot topic in Sri Lanka. In April 2019, the Board of Directors of the Millennium Challenge Corporation (MCC) approved a compact program for Sri La


Sri Lanka needs a president hungry for success, not power

Friday, 16 August 2019

The late John F. Kennedy described politics as a “noble adventure, an adventure in which one joins hands with the masses for the service of man”. Not that the Kennedys didn’t play “politricks” in their heyday. But playing “politricks” w


Columnists More

Special Report

SPECIAL REPORT MORE