Markets see-saw over Trump’s trade decision on China

Concession on Chinese investments leads to Wall Street gains which were later reversed

 Traders monitor the markets in the S&P options pit at the   global markets exchange in Chicago, Illinois.  Photograph:  Scott Olson/Getty

Traders monitor the markets in the S&P options pit at the global markets exchange in Chicago, Illinois. Photograph: Scott Olson/Getty

 

Shares rose as US president Donald Trump pulled back from plans to block Chinese investment in American tech companies, easing fears of a trade war. However, gains were reversed later when one of his adviser’s said that his decision did not amount to a softened stance on China.

DUBLIN

Bank stocks were under pressure for much of the day on the back off poor sentiment towards the sector. AIB fell 1.29 per cent to €.567. However, Bank of Ireland finished 0.82 per cent ahead at €6.75 having dipped as low as €6.60, according to traders.

Building materials giant and index heavyweight CRH rose 1.47 per cent to €31.08.

Food group Glanbia added 1.09 per cent to €15.83. “There has been steady volume in Glanbia for the last week or two,” one dealer said.

Low-cost airline Ryanair was off 0.91 per cent at €15.81. European aviation shares lost a bit of altitude yesterday following a rise in oil prices.

LONDON

Costa Coffee and Premier Inn owner Whitbread climbed 3.44 per cent to 4,027 pence sterling after reporting that sales rose 3.2 per cent in the first three months of its financial year.

The food, drink and hotel group’s chief executive, Alison Brittain, also said Whitbread was making good progress with a plan to demerge the Costa Coffee franchise.

Oil major BP rose 3.35 per cent to 582.3p as crude prices spiked yesterday.

Miners lifted the FTSE 100 higher with Rio Tinto and BHP up 2 per cent and 2.7 per cent. Among individual stocks, shares in Carnival continued a recovery from a sell-off on Monday prompted by weak guidance in its results.

The recovery was boosted by an upgrade from Berenberg to “buy” from “hold” and the stock ended the day up 3 per cent. Carnival’s shares were up 1.8 per cent.

Shares in takeover target IWG, the British workspace firm, fell 2.8 per cent after it warned on profit, blaming the cost of opening new space and a weak performance in Britain. Traders said the takeover interest from private equity firms Terra Firma and TDR Capital among others were supporting the stock despite the profit warning.

EUROPE

Air France KLM fell almost 1 per cent to €7.03 as the oil price spike left investors wary of airlines. Total and Royal Dutch Shell rose 2 per cent and 2.6 per cent respectively. Industrials Airbus and Siemens, which had been big drags on the index as investors priced in a more difficult trade environment for big exporters, rebounded with rises of 2.7 per cent and 1.9 per cent.

Imerys shares rose 4 per cent after analysts at Exane BNP Paribas upgraded the mineral extracting and processing company to “outperform” from “neutral”.

Shares in French oil storage and distribution company Rubis fell 5.1 per cent after Berenberg cut the stock to “hold” from “buy”.

US

Stocks fell on renewed uncertainty regarding the US stance on Chinese investments in American technology companies, reversing gains earlier in the session.

As the market open, stocks rose when US president Donald Trump said he will use a strengthened national security review panel to deal with potential threats from Chinese acquisitions of US technology, instead of imposing China-specific restrictions.

However, later, White House economic adviser Larry Kudlow said in an interview on Fox that Mr Trump’s announced plan did not indicate a softened stance on China.

“The market took that as a sign that the hardline approach to China has not waned,” said Quincy Krosby, chief market strategist at Prudential Financial in Newark, New Jersey.

The Dow fell 165.52 points, or 0.68 per cent, to 24,117.59, the S&P 500 lost 23.43 points, or 0.86 per cent, to 2,699.63 and the Nasdaq dropped 116.54 points, or 1.54 per cent, to 7,445.09.

– Additional reporting: Reuters