The world markets are moving down amid a lack of tangible results in US-China trade talks, as well as disappointing Chinese inflation data.
The three-day talks in Beijing were the first direct talks since Donald Trump and Xi Jinping met in Buenos Aires in December. The US sales representative’s office said that negotiators from both sides have discussed “ways to achieve fairness, reciprocity and trade balance”.
Investors were also disappointed by the level of Chinese consumer inflation in December, which was published with the opening of markets. Its value is growing to 1.9%, which is less than the forecasted 2.1%.
The manufacturing inflation is up to 0.9%, which also fails to meet the 1.6% expected by economists. This information comes against the weaker-than-expected December data from China’s manufacturing sector.
Investors attribute this decline to the negative impact the trade war has on the Chinese economy. In order to stimulate its slowing economic growth, Beijing has taken measures such as reducing the bank reserves and promoting credit.
Asian markets recap
Most Asian markets ended today’s trading session on red territory amid a lack of tangible results in US-China trade talks, as well as disappointing Chinese inflation data.
On Chinese exchanges, the continental index Shanghai Composite declined by 0.36% to 2,535.10 points, with investors continuing to worry about the trade war.
Hong Kong’s index Hang Seng recorded a slight increase of 28.59 points, or 0.11%, to 26,490.91 points with the shares of the technology company Tencent appreciated by 0.31%.
During today’s session, many investors in the Chinese consumer electronics maker Xiaomi Corp decided to sell their shares in the company, bringing the company’s losses to more than 6 billion USD over the past three days.
In Japan, the blue-chip index Nikkei 225 wiped out 263.26 points, or 1.29% of its value, ending the session at 20,163.80 points.
The South Korean index Kospi reported a minimum decline of 0.07% to 2,063.28 points. The shares of SK Hynix and SK Innovations grew by 2.67% and 0.83% respectively. Korean buyers of Iranian oil are expected to stop importing from the Islamic Republic in late January or early February, which weights on energy stocks.
In Australia, the local index S&P ASX 200 rose by 0.29% to 5,795.30 points, helped by the good performance of companies in the banking sector. The shares of Westpac and Commonwealth Bank of Australia appreciate 0.35% and 0.17% respectively. The value of the shares of National Australia Bank and Australia and New Zealand Banking Group rose by 0.12% and 0.56% respectively.
European mid-session market recap
German stocks are trading with DAX 30 decreasing by 0.33% to 10,856.92 points at 11:00 GMT. The index went to its day-low minutes after opening but then recovered from the initial loss. The stocks of carmakers are trading on red with BMW wiping out 1%, while Volkswagen decreasing by 0.4%. The shares of the chemical giant BASF declines by 0.1%, while the pharmaceutical company Bayer registers a decrease of 0.32% in mid-session.
French stocks fell on Thursday as US-China trade talks in Beijing ended without significant breakthroughs and a partial US government shutdown over funding for a border wall entered the 20th day. The index CAC 40 is down by 0.7% to 4,779.92 points at 11:00 GMT. Automakers were retreating, with Renault declining by 0.8% and Peugeot losing 0.9% on tariff worries. The stocks of Airbus dropped by 1.4% after the aircraft manufacturer reported that delivered 800 commercial aircraft to 93 customers in 2018. The deliveries were 11% higher than the previous record of 718 units, set in 2017, but remains below the result registered by Boeing. Sodexo rallied 2%. The food services and facilities management group reported a rise in Q1 revenues and maintained FY19 objectives.
The British FTSE 100 stabilizes at the lower level as analysts pick through the retail debris. The index is down by 5 points to 6,901.81 points at mid-session. Luxury items pedlar Burberry Group PLC was down 3.0% on concerns over slowing growth in the Chinese economy.
Wall Street pre-session recap
Wall Street stock index futures were lower on Thursday morning, as market participants awaited further developments from the latest round of US-China trade talks.
At around 6:30 a.m. ET, Dow futures indicated a negative open of about 122.12 points. Futures on the S&P 500 and Nasdaq were also seen relatively downbeat, with expectations for the negative start of -16.71 points and -46.94 points respectively.
No major economic data reports are expected to be published on Thursday. Instead, investors may turn their attention to a question and answer session with Federal Reserve Chairman Jerome Powell and Economic Club of Washington President David Rubenstein on Thursday afternoon.