Hopes of easing in US-China trade war push global stocks higher

A gauge of global stocks edged higher on Friday, pushed by hopes of easing trade tensions between China and the United States.

But there was still weakness on Wall Street, and caution over pending US tariffs on Chinese goods put the yuan on track for its biggest monthly decline in 25 years.

DUBLIN

The Irish index of shares ended the day in positive territory, lifted by gains in buildings and airline stocks. The Iseq closed at 5879.42, half a per cent higher over the day.

Ryanair ended the day up, trading at €9.14 following the announcement that Eddie Wilson would become chief executive of the airline. Ryanair has restructured itself as a group holding company comprising several airlines; Michael O'Leary will remain as overall chief executive. The company outperformed its peers, with IAG, Easyjet and Air France all ending the session lower.

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Analysts said CRH continued a good run, remaining above €30 to close the week 0.4 per cent higher at €30.28.

Cairn Homes also had a decent day, gaining 1.78 per cent to end the day at €1.028. The stock had hit highs of €1.03 during the day.

Property investor Ires finished 2 per cent higher at €1.77.

Bank of Ireland and AIB were among the weaker stocks on the market on Friday, ending the session lower in line with their European peers. AIB fell 0.43 per cent to €2.302, while Bank of Ireland dipped to €3.462, a 1.54 per cent decline on the day.

LONDON

Gains in mining companies after nickel prices hit an all-time high and signs of a resumption of US-China trade talks lifted London’s FTSE 100 on Friday, as the index snapped a four-week losing streak.

The main index added 0.3 per cent, but still posted its sharpest monthly fall since October in a month ravaged by escalating trade disputes and fears of a recession. The mid-cap FTSE 250 gained 0.5 per cent.

Heavyweight mining companies such as Rio Tinto, BHP and Glencore rose more than 2 per cent each and boosted the blue-chip index as a waste spill at a nickel plant in Papua New Guinea raised supply fears.

On the FTSE 250, Grafton Group saw its stock surge 10 per cent, with analysts noting somewhat of a relief rally in the stock. Shares in the builders' merchanting group had been under pressure in recent days, but the group announced operating profit of £98.1 million (€108 million) on Friday, beating analyst estimates.

Investors also took heart from signals emanating from Washington and Beijing overnight that they would resume talks to try to end their protracted trade war, which broadly supported global stock markets.

However, oil majors BP and Shell were among a handful of blue-chip stocks in the red as they tracked a drop in crude prices. Sterling remained subdued as lawmakers scrambled to find a solution to the chaotic Brexit process, pushing up exporter stocks such as Diageo and Unilever.

EUROPE

European stocks scaled fresh one-month highs on Friday, wrapping up a brutal month on a positive note as investors took comfort from Chinese and US willingness to return to trade talks.

The pan-European STOXX 600 rose 0.7 per cent to hit its highest level since August 2nd, building on the previous day’s rally after both China and the United States indicated they were discussing the next round of negotiations in September. Germany’s DAX Index increased 0.8 per cent over the session, while France’s CAC-40 index closed up 30.5 at 5480.5.

NEW YORK

Gains on Wall Street petered out on Friday, with the Nasdaq index turning negative, as an upbeat mood fuelled by signs of upcoming US-China trade talks and solid domestic consumer spending data waned ahead of a long Labor Day weekend.

The three main indexes opened higher, following data which showed strong US consumer spending in July and signals from Washington and Beijing on Thursday that they will resume trade talks, as the countries discussed the next round of in-person negotiations in September.

On Wall Street, the Dow Jones Industrial Average rose 12.01 points, or 0.05 per cent, to 26,374.26, the S&P 500 lost 1.44 points, or 0.05 per cent, to 2,923.14, and the Nasdaq Composite dropped 30.32 points, or 0.38 per cent, to 7,943.08.

Market watchers expressed caution given the fluctuating rhetoric around US-China trade relations. Despite recent conciliatory comments, the Trump administration on Sunday is scheduled to begin collecting 15 per cent tariffs on more than $125 billion in Chinese imports, including smart speakers, Bluetooth headphones and many types of footwear.

– Additional reporting: Reuters, Bloomberg