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Stock market update: Tariff jitters cause U.S. volatility; Asian and European markets show resilience
Stock market update: Tariff jitters cause U.S. volatility; Asian and European markets show resilience

Economy ME

time4 days ago

  • Business
  • Economy ME

Stock market update: Tariff jitters cause U.S. volatility; Asian and European markets show resilience

Stock markets across Asia, Europe, and the U.S. continued on Wednesday to reflect a complex environment where trade tensions, Fed policy uncertainty, and economic data releases interplay. Investors are adopting a cautious stance amid hopes for negotiation breakthroughs and the prospect of more accommodative monetary policy, while remaining alert to evolving geopolitical and inflationary pressures. Global stock markets are navigating cautious optimism amid mixed economic signals and tariff-related uncertainties. Asian markets exhibited modest gains and subdued trading following the release of U.S. economic data that dampened hopes for immediate Federal Reserve rate cuts, while European indices showed steady performance as investors weigh ongoing geopolitical and trade developments. Asian markets In Asia, Japan's Nikkei 225 rose by 0.6 percent to close at 40,777.45, buoyed by optimism ahead of key corporate earnings from major automakers and electronics giants. Australia's S&P/ASX 200 also advanced by 0.5 percent to 8,290, reflecting resilience despite regional tariff concerns. Meanwhile, South Korea's Kospi slipped slightly by 0.3 percent to 3,357 amid caution over the impact of U.S. tariffs on chipmakers. Hong Kong's Hang Seng index fell 0.2 percent to 24,947.57, and the Shanghai Composite in China edged up by 0.3 percent to 3,627.54. The broader MSCI Asia Pacific Index finished the session with a modest 0.2 percent gain, reflecting a cautious but constructive tone in the region as investors assess the implications of President Trump's ongoing trade policies and pending tariff announcements for key sectors such as semiconductors and pharmaceuticals. Read more: Stock markets display renewed optimism as investors embrace trade negotiation hopes European indices European stock markets continued to show resilience despite ongoing global uncertainties. Key indices such as the FTSE 100, DAX, and CAC 40 maintained steady levels, supported by stable commodity prices and improved corporate earnings outlooks. Market participants remain focused on upcoming economic indicators and the unfolding effects of trade negotiations between major economies. U.S. equities Turning to the U.S. equities market, the S&P 500 ended Tuesday at 6,299.19, down about 0.5 percent, continuing a volatile trend that saw sharp swings earlier in the week. The Dow Jones Industrial Average recorded a mild decline of 0.3 percent to finish at 44,736, while the Nasdaq Composite retreated 0.4 percent, closing near 20,550. Investors are digesting weaker-than-expected U.S. services sector data that raised doubts about the Federal Reserve's next moves on interest rates. This has injected caution into markets that had rallied on early week speculation of rate cuts following slack jobs numbers. The interplay of softening U.S. labor conditions and aggressive tariff policies is complicating the Federal Reserve's balancing act between controlling inflation and sustaining economic growth. Commodities showed mixed signals with oil prices modestly rebounding to around $65.47 per barrel for both WTI and Brent crude, following a four-day decline as OPEC+ prepares to increase production in September to regain market share amid supply concerns. Gold futures slightly retreated to $3,430.10 per troy ounce, while copper futures edged down marginally, reflecting varying investor appetite for safe-haven and industrial metals.

China Market Update: Massive Inflow Into Hong Kong Stocks From Mainland China Overnight
China Market Update: Massive Inflow Into Hong Kong Stocks From Mainland China Overnight

Forbes

time4 days ago

  • Business
  • Forbes

China Market Update: Massive Inflow Into Hong Kong Stocks From Mainland China Overnight

Asian equities had a strong day, led by Australia, South Korea, Taiwan, Thailand, and Vietnam, while India underperformed, as the US dollar weakened overnight. Despite wet and overcast conditions, both Hong Kong and Mainland China stocks advanced in a broad-based rally. Hong Kong was buoyed by Tencent, which rose 1.64% ahead of a mobile game release, and by gains in online entertainment stocks, including Kuaishou (up 2.79%), Bilibili (up 2.94%), and Tencent Music Entertainment (up 2.61%). Banks and healthcare companies, particularly in the biotechnology and pharmaceutical sectors, also outperformed. However, some large-cap stocks lagged, including Alibaba, which was down -0.17%, Xiaomi, which was down -0.46%, Contemporary Amperex Technology (CATL), which was down -1.29%, and BYD, which was down -2.1%. Mainland investors were highly active, purchasing a substantial $2.98 billion worth of Hong Kong-listed exchange-traded funds (ETFs) and stocks. The Hong Kong Tracker ETF saw an especially large inflow, and Tencent had significant buying. It is notable how little attention Western media gives to positive Chinese economic data. For instance, today's S&P Global July Services Purchasing Managers' Index (PMI) for China came in at 52.6, beating expectations of 50.4 and up from June's reading of 50.6. Meituan finished down -0.08%, but after the close, it announced plans to support small and medium-sized merchants and restaurants. This sector has suffered from intense price competition among Meituan, and Alibaba in the food delivery and instant commerce space. The response stems from the firm's intention to follow the government's mandate to curb unhealthy internal competition. The People's Bank of China (PBOC) and seven other government agencies, including the Ministry of Industry and Information Technology (MIIT), State Administration of Foreign Exchange (SAFE), the National Development and Reform Commission (NDRC), and the Ministry of Finance (MoF), issued new 'Guiding Opinions on Financial Support for New Industrialization' following the third Plenary Session of the Communist Party of China (CPC) Central Committee. This document demonstrates how top government leadership sets overall direction, which is then implemented by various agencies. As the name suggests, the policy aims to ease the allocation of financial resources to strengthen industrial chains with a focus on science and technology. Mainland media highlighted the goal of 'strengthening medium and long-term loan support for digital infrastructure construction, such as 5G, industrial internet, data, and computing centers.' Agencies are tasked with supporting 'emerging industries such as new-generation information technology, basic software, industrial software, intelligent (networked) automobiles, new energy, new materials, high-end equipment, spatiotemporal information, commercial aerospace, biomedical, and network and data security.' Spatiotemporal information refers to data that has both spatial (location-based) and temporal (time-based) elements. While the document does not use the term 'anti-involution,' it specifically calls for actions to 'prevent internal competition.' Despite the document's emphasis on growth and technology sectors, value stocks outperformed, led by banks, insurance, and oil companies in Shanghai. Electronic equipment companies were also strong, as Foxconn was up 6.31%. Broad market internals in both Hong Kong and Mainland China remain strong. Although a few stocks are technically overbought, the continued market breadth is a positive sign. In political news, President Trump expressed optimism about a potential US-China trade deal during his CNBC appearance this morning. He also made comments about potentially raising tariffs on India, noting how little profit US companies make in India; currently, only one publicly traded US company generates more than 20% of its revenue from India, compared to 25 companies with over 20% from China and 57 companies with more than 10% from China, according to Bloomberg's equity screening tool. On a personal note, the Ground News app was recently recommended to me. It provides a measure of the political bias of news stories by source, a useful tool to check out! Live Webinar Join us on Wednesday, August 6th, at 11 am EDT for: Private AI Unicorn Access: How Our AI ETF Opens Doors to xAI and Anthropic Please click here to register New Content Read our latest article: KraneShares KOID ETF: Humanoid Robot Rings Nasdaq Opening Bell Please click here to read

Trade deal hopes lift Europe ahead of ECB meeting
Trade deal hopes lift Europe ahead of ECB meeting

Reuters

time24-07-2025

  • Business
  • Reuters

Trade deal hopes lift Europe ahead of ECB meeting

LONDON, July 24 (Reuters) - Trade deal optimism lifted world stocks to fresh record highs on Thursday, ahead a raft of global economic data, the European Central Bank's pre-summer break interest rate meeting and an unexpected trip to the Fed by U.S. President Donald Trump. Reports the European Union and Washington were closing in on 15% tariffs with exceptions for some key sectors came hot on the heels of a deal with Japan and lifted MSCI's broadest index of world equities (.MIWD00000PUS), opens new tab for a seventh straight session. Tokyo's Nikkei 225 (.N225), opens new tab finished within touching distance of its own all-time high overnight and the bullish mood continued in Europe as Germany's export-reliant DAX (.GDAXI), opens new tab jumped over 1% and the regional STOXX index (.STOXX), opens new tab climbed 0.6%. Better than expected Deutsche Bank ( opens new tab results that sent its shares up over 4% helped lift banking stocks to their highest since the 2008 global crash, although Nestle (NESN.S), opens new tab slumped 4.5% after it posted first-half results and put one of its businesses up for sale. Focus was already turning to the European Central Bank's pre-summer break meeting where the bank looks set to hit pause after seven straight rate cuts that have halved euro zone rates from 4% to 2% over the last year. Inflation is now back at the ECB's 2% goal and expected to stay there, and it is hoping the fog hanging over Europe's trade relations with the U.S. is about to clear. "This one is sure to be a hold, so we are watching what (ECB President) Christine Lagarde says about the economy and the trade negotiations with the U.S.," TD Securities' European macro strategist Julie Ioffe said. "Right now the talks are definitely not pointing to 10% tariffs - we are expecting between 15-20%, so either way that is above the ECB's base case and will push them towards further cuts," she added, saying a September move was expected. There was a mixed bag of PMI data too, which showed fragility in France following budget cut proposals there, but also resilience in Germany and other parts of the euro zone that lifted the regional figure to an 11-month high. The euro dipped 0.1% to $1.1760, although that wasn't far from a more than three-year high of $1.1830 hit earlier this month. Trade hopes also lifted the risk-sensitive Australian dollar to an eight-month high of $0.6625. Against the yen the dollar fell 0.1% to 146.35, extending its drop to a fourth straight session. Olivier Korber, an FX strategist at Societe Generale, said he expected the yen to strengthen further, citing support from the trade deal and the possibility of higher Japanese interest rates. Markets remained relatively relaxed after a surprise White House announcement that Donald Trump, who has been ramping up his attacks on Fed Chair Jerome Powell again in recent weeks, would visit the U.S. central bank's headquarters later. The purpose of Trump's visit is unclear but it may be a move to pressure Powell and the Fed to cut rates, and it comes just a few days before the next Fed policy meeting at the end of this month, said Vasu Menon, managing director of investment strategy at OCBC. The yield on benchmark 10-year Treasury notes was broadly steady at 4.3937%, but the EU trade deal talk lifted Germany's 10-year yield 7.5 basis points to 2.674%. That was shaping up to be its biggest rise since mid May. Wall Street stocks futures pointed to more record highs there later. Second-quarter earnings are well underway, with 23% of the companies in the S&P 500 having reported. Of those, 85% have beaten Wall Street expectations, according to LSEG data. In commodity markets, oil prices rose on speculation the various trade deals would support global growth and after a sharper than expected decline in U.S. crude inventories. U.S. crude ticked up 0.52% to $65.59 a barrel. Gold was slightly lower at $3,370 per ounce as rising appetite for risk in broader markets dented demand for safe-haven assets.

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