Trade fears spread across the investors and worsened the markets’ sentiment for global economic growth. Thus, most of the indexes are trading into the red. with the investors digesting the reports on US-China trade talks and waiting to get some cues from today’s Fed meeting and Thursday’s BoE rate decision.
The bad mood settled on the most stock exchanges after Chinese negotiators raised doubts that Washington will remove the already applied customs duties on Chinese imports. According to them, the US President Donald Trump does not guarantee that trade agreement will stop increasing in the customs tariffs. However, a new round of talks is scheduled for next week in Beijing with the deadline for reaching an agreement set for the end of April.
The investors’ focus was also on the meeting of US Federal Reserve, which started yesterday, and today the Governor of the Central Bank is expected to announce to the media the economic forecast and the preservation of the monetary policy course.
Asian markets recap
Most of the indexes in the Asia-Pacific ended today’s trading session with declines amid renewed concerns about the development of the US-China trade talks.
In China, the continental benchmark Shanghai Composite decreased slightly by 0.01% to 3,090.64 points. The Hong Kong’s index Hang Seng declined by 145.31 points, or 0.49%, to 29,320.97 points.
The stocks of the Chinese smartphone maker Xiaomi fell more than 4.7%, although the company’s fourth-quarter report has surpassed analysts’ expectations. Xiaomi reported a threefold increase in earnings for the fourth fiscal quarter of 2018, reaching 1.85 billion CNY (275.59 million USD). The results show that Xiaomi has managed to offset the downturn in China (the world’s largest smartphone market), focusing more strongly on markets in India and Europe.
On the other hand, Tencent Holdings, a technology company, said on Tuesday it plans to remove about 10% of its executives to vacate space for younger directors. This is happening at a time when China’s biggest gaming and social networking player faces a slowdown in growth. The move will be made at a time when Tencent escapes one of its most serious crises. Chinese regulators halted game approvals for a 9-month period in 2018, which in a way blocked the company’s business.
In South Korea, the index Kospi ended the session with a decrease of 0.02% to 2,177.10 points. The stock of SK Hynix microprocessor manufacturer increased by 3.68%.
Australian index S&P ASX 200 declined by 0.32% to 6,165.30 points.
Japanese blue-chip index Nikkei 225 ended the trading into the green with an increase of 0.20% to 21,608.92 points. The stocks of Nintendo and Sony declined by more than 3% after Google launched its game streaming platform yesterday.
European markets mid-session recap
With eyes fixed on a US Federal Reserve statement and news conference later in the day, the pan-European STOXX 600 index fell 0.4 percent as investors booked profits after five sessions of gains.
Germany’s index DAX 30 is trading with a decrease of more than 1.3% to 11,633.48 points at 11:50 GMT. The stocks of Bayer are down by 12% after a San Francisco jury became the second to rule against Roundup, eight months after a 289 million USD award to claimants in a similar case. That award was later reduced to 78 million USD and is on appeal. Bayer acquired Monsanto, the longtime maker of Roundup, for 63 billion USD last year. The stocks of BASF are also down by 0.5%, while shares of Deutsche Bank slid by 2.2%.
French stocks are also trading with decreases in mid-session. The index CAC 40 is down by 11 points, or 0.21%, to 5,414.74 points. The stocks of Airbus are down by 0.62%, while shares of financial company BNP Paribas are down by 0.92%.
The British index FTSE 100 is down by 6.35 points, or 0.09%, to 7,317.65 points at 11:50 GMT. The stocks of the satellite operator Inmarsat jumped by 16.99% after announcing that was in talks about a 3.3 billion USD cash offer from a private equity-led consortium, opening up the possibility of a bidding war. Mining stocks slipped nearly 2.5% as iron ore prices plunged in anticipation of increased supply after Vale SA was set to restart work at its largest iron ore mine. Home improvement retailer Kingfisher slipped 3.5% after it reported lower full-year results and said it had started the process to find a replacement for chief executive Véronique Laury.
Wall Street pre-session recap
Wall Street stock index futures barely moved on Wednesday as investors await a policy decision by the Federal Reserve.
At 07:30 a.m. ET, Dow Jones Industrial Average futures pointed to a drop of 14 points at the open. Futures in S&P 500 and Nasdaq 100 were also little changed.
No economic data are expected on Wednesday, however, on the earnings front, General Mills is set to report its results before the bell and Williams-Sonoma will report after the bell.