Monday 27 January 2020

Markets steady as Korean fears ease

Traders work on the floor of the New York Stock Exchange (NYSE)
Traders work on the floor of the New York Stock Exchange (NYSE)


Wall Street opened higher on Monday, with broad gains across sectors, as investor sentiment was lifted by easing tensions in the Korean peninsula after key US officials played down the risk of an imminent war with North Korea.

All the 11 major S&P sectors were higher, with S&P financial's 1.12pc rise leading the gainers.

Global stocks lost nearly $1 trillion last week after US President Donald Trump warned North Korea that it would face "fire and fury" if it threatened the United States, leading to a war of words between Pyongyang and Washington.

US officials, including National Security Adviser HR McMaster and CIA Director Mike Pompeo, played down the risk on Sunday, while South Korea's president said resolving Pyongyang's nuclear ambitions must be done peacefully.

The move steadied markets.

"Feels as though the North Korean tension seems to be abating a bit, with commentary coming out of China and the United States. But the situation seems to have de-escalated in the near term," said Art Hogan, chief market strategist at Wunderlich Securities.

"After the one-and-a-half percent self-off last week, we got a bit of a investor attitude to buy the dip," Mr Hogan said.

European shares also bounced after falling nearly 3pc last week, with the pan-European STOXX 600 up 0.9pc following a similar jump in MSCI's index of Asia-Pacific shares outside Japan.

Gains were led by bounces in Australia, Hong Kong and South Korea

In Dublin, the Iseq was almost 1pc higher at 6,646.46 by late afternoon.

Shares in CRH rose 1.14pc to €29.18 each and AIB was slightly higher at €4.8740 after Goodbody recommended both stocks.

Irish Independent

Also in Business