Global Market Report - September 14

World markets closed the week on a more positive note, but China's main stock markets drited lower again on weaker data

James Gard 14 September, 2018 | 10:55AM

Global Market Report

Asia

The possible renewal of trade talks between the US and China that gave a brief boost to Asia markets yesterday but this outbreak of optimism proved shortlived. Both sides resumed their war of words at the end of the week, with President Trump on the one side saying the US doesn’t need a deal and China on the other saying it won’t “surrender” to America’s demands. China’s Shanghai and Shenzhen indices drifted lower on Friday after Thursday’s brief recovery on August data that showed more evidence of economic weakness.  Hong Kong’s Hang Seng managed to consolidate above the 27,000 points level with a 1% rise day on day, while Japan also pushed back above a key technical level, in the Nikkei 225’s case 23,000 points. So Asia’s markets are still being overshadowed by macro events – trade war fears, China’s possible slowdown – but are still attempting some sort of recovery in tune with reasonably positive US and European markets.

Europe

The FTSE 100 managed a minor gain in morning trading on last night’s close as European shares in general rose. SSE (SSE) was one of the earliest fallers after this week’s profit warning continued to send aftershocks through the utilities sector.

Mark Carney’s dire warning over UK house prices in the event of a no-deal Brexit set Twitter alight but failed to weaken the pound. Next week’s inflation figures will focus the Bank’s minds on more pressing matters, as the rise in the cost of living is still above target. There’s no Bank of England meeting in October so there are only two possible occasions to raise interest rates this year. But while Brexit negotiations reach a crunch point in the next six months, the consensus forecast is for the Bank to hold rates until next spring at least. The Monetary Policy Committee voted unanimously to hold interest rates at 0.75% yesterday.

In the Eurozone, German, French, Italian and Spanish exchanges were modestly higher as the dollar dipped and investors took some comfort from Turkey’s move to raise rates to combat soaring inflation and prevent the lira losing even more ground.

North America

Apple (AAPL) shares rose over 2% on Thursday as the stock market caught up with news of more high-end phone products set to launch. The company’s shares also nudged slightly higher in pre-market trading on Friday.

After yesterday’s softer-than-expected inflation data, attention moves to the University of Michigan sentiment index, which is a provisional reading for September.

August inflation could be seen to take the heat off the Federal Reserve in its next meeting at the end of September.

 

 

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Securities Mentioned in Article

Security NamePriceChange (%)Morningstar
Rating
Apple Inc193.55 USD1.12
SSE PLC1,118.00 GBX-0.97

About Author

James Gard  is subeditor for Morningstar.co.uk