Business World

Wednesday 15 August 2018

Global markets surge on softer China line

A board, showing the currency exchange rates of the US dollar and the Euro against the Russian rouble, is on display in a street in Moscow, Russia. Photo: Reuters
A board, showing the currency exchange rates of the US dollar and the Euro against the Russian rouble, is on display in a street in Moscow, Russia. Photo: Reuters

Agencies

Global stocks surged yesterday following conciliatory remarks from Chinese President Xi Jinping aimed at releasing some pressure from a trade dispute between the world's biggest economies. Treasuries fell with the dollar.

All major US equity indexes were up more than 1.3pc after Xi said Cold War and zero-sum mentalities were "out of place" and backed free trade and dialogue to resolve disputes.

Equities added to gains after White House trade adviser Peter Navarro said the doors are open for trade talks between the world's two largest economies. The Stoxx Europe 600 Index followed shares from Sydney to Hong Kong higher.

Still, stocks retreated from their earlier highs as investors digested additional revelations about Monday's raid on the office of Trump's personal lawyer, Michael D Cohen, by the FBI.

Elsewhere, oil and metals climbed. The yen declined and gold pared an earlier gain. European government bonds edged lower and the single currency rose after somewhat hawkish remarks by a European Central Bank official.

The pound rose to a two-week high on Tuesday after the dollar fell and a top policymaker said the Bank of England should press ahead with an interest rate hike to curb inflation.

Economists expect the Bank of England to raise rates in May and the comments by policymaker Ian McCafferty along with strong housing survey data this week offered further encouragement.

Against the euro, the pound strengthened to 87.15 pence per euro. In Dublin shares closed up only marginally at 6,638.33.

European share gains were widespread, with the STOXX 600 closing up 0.82pc, slightly behind Wall Street.

Irish Independent

Business Newsletter

Read the leading stories from the world of Business.

Also in Business