Global stock markets are mixed on Tuesday after the S&P 500 hit a new high following the latest truce in the costly Sino-American trade war.
London and Tokyo rose, while Germany declined and Shanghai was unchanged. Hong Kong advanced despite protests over a proposed extradition law that led to police using tear gas to clear streets. Wall Street index futures were slightly on the red.
The investors were calm after the weekend events of the US-Chinese trading front after the two countries’ presidents agreed not to impose new customs duties after talks at the G20 summit in Osaka. On Monday, US President Donald Trump said talks between the two countries have already begun.
However, on Monday, the Trump administration ratcheted up tensions with the European Union by proposing additional tariffs on 4 billion USD of European imports in a dispute over subsidies to aircraft manufacturers.
Meanwhile, the Organization of Petroleum Exporting Countries (OPEC) has agreed to extend the quota deal by another nine months. The deal must also be approved by non-OPEC allies like Russia at a meeting today, but Russian president Vladimir Putin also confirmed his support for the extension of the deal.
Asian markets recap
Most stock exchanges in the Asia-Pacific region ended the session with gains after the Reserve Bank of Australia lowered its key interest rate to a new historic low.
In China, the mainland indexes registered mainly increases, with the Shenzhen Component adding 0.16% to its value to 9,545.52 points, while Shenzhen Composite advanced 0.159% to 1,619.12 points. Shanghai Composite, however, was into the red with a minimum drop of 0.03% to 3,043.94 points.
In Hong Kong, the index Hang Seng jumped by 1.26%.
In Japan, the blue-chip index Nikkei 225 added 0.11% and finished trading at 21,754.27 points, while Topix recorded a 0.31% rise to 1,589.84 points. The gains in the Paper and Pulp, Railway and Bus, as well as Real Estate sectors led shares higher. The best performers during the session were Dainippon Screen Mfg (+4.52%), Trend Micro (+3.83%) and Yokogawa Electric (+3.45%), while on the flipside were Familymart Ltd (-2.46%), Taiyo Yuden (-2.35%) and Yamaha Corp (-2.09%).
In South Korea, the index Kospi, however, fell by 0.36% to 2,122.02 points. The decline comes as Japan’s export curbs against Seoul added to trade uncertainties over the Sino-American talks, while automakers slid after posting lean sales in June. Japan’s decision to tighten controls on exports of high-tech materials to South Korea is not in violation of World Trade Organization (WTO) rules, Industry Minister Hiroshige Seko said on Tuesday.
In Australia, the S&P/ASX 200 achieved a minimum growth of 0.08% reaching a level of 6,653.20 points, with most sectors ending in the green. The Reserve Bank of Australia announced earlier Tuesday that it cut its key interest rate by 25 basis points to a new historic bottom of 1%. Following the bank’s decision, which was expected, the Australian dollar was exchanged for 0.6986 USD.
European markets mid-session recap
European stocks traded mixed on Tuesday after President Donald Trump said that trade talks with China, which had stalled in May, have “already begun” following his meeting with Chinese President Xi Jinping at the weekend. The pan-European STOXX 600 inched higher by 0.14% to 388.42 points. The food and beverage stocks are gaining 1% while autos led losses with a 0.8% fall. The focus in Europe will be on the third consecutive day of discussions over who should take the EU’s top jobs until 2025. Leaders from the 28 member states were embroiled in exhaustive talks Monday which resulted in Italy and eastern European states blocking Dutch former Foreign Minister Frans Timmermans from replacing Jean-Claude Juncker at the helm of the EU Commission.
German index DAX 30 is trading down by 22.36 points, or 0.18%, to 12,499.02 points at 10:10 GMT. The stocks of carmakers Volkswagen and Daimler are down by 0.17% and 0.44%, while those of banking giants Deutsche Bank and Commerzbank slid by 0.9% and 2%, respectively. Chemical enterprises BASF and Bayer and also deep into the red, with their shares declining by 1.86% and 1.35%.
French index CAC 40 is down by 0.05% to 5,565.07 points. The stocks of Renault sank by 1.3%, while Peugeot inched higher by 0.2%. The shares of Airbus are down by 0.8% amid the continuing EU-US tension on the trade front in relation to aircraft manufacturing subsidies.
British blue-chip index FTSE 100 is up by 0.64% to 7,545.32 points. The PMI data released on Tuesday showed that UK construction activity suffered its sharpest downturn in over a decade in June on the back of rising Brexit concern, causing the British 10-year government bond yield to fall to its lowest level since October 2016. The stocks of the advertising giant WPP collapsed by 2.2% after the company announced that it is in exclusive talks to sell a majority stake in data analytics unit Kantar to private equity firm Bain Capital. The 4 billion USD deal is intended to steer the world’s biggest advertising company back to growth. Meanwhile, the shares of the asset management company Jupiter fell by 6.8% after news that star European fund manager Alexander Darwall will quit, launching his own investment boutique.
Wall Street pre-session recap
Wall Street stock index futures were slightly lower Tuesday morning, amid uncertainties over the prospect of a trade deal between the world’s two largest economies.
At around 6:25 a.m. ET, Dow futures fell by 22 points, indicating a negative open of more than 34 points. Futures on the S&P and Nasdaq were seen lower as well, suggesting for a negative start by 2.33 points and 15.39 points, respectively.
During the day, the investors are likely to monitor the latest light vehicle sales figures for June.
In corporate news, Acuity Brands, Simply Good Foods and Greenbrier Companies are expected to report their latest quarterly results before the opening bell.