Mood lifts on global markets as tensions ease between US and China

Global stock markets advanced on Wednesday on signs of a lessening in US-China trade tensions and the prospects of a fresh stimulus package from the European Central Bank

DUBLIN

The Iseq performed strongly, finishing the day up 1.4 per cent as relief over a potential easing of global trade disputes rose among investors.

Just five stocks finished the session in negative territory, led by Providence Resources, down 3.2 per cent to about 6 cent per share.

Irish-listed shares with a global focus performed well, reflecting the positive mood among markets that the disputes involving the US and China could ease. Building materials giant CRH, which has extensive US interests, was up 1.5 per cent to €31.01. Exporters fared well, such as the Kerry Group, up 1.8 per cent to €108.70.

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Irish Continental Group, the operator of Irish Ferries, rose by 2.1 per cent to €4.35, following confirmation that the duty free booze cruise between Ireland and the UK will return in the event of a no-deal Brexit.

LONDON

UK stocks advanced on signs of less tension in the US-China trade fight and prospects of more stimulus from central banks, while shares in London Stock Exchange scaled a record high after Hong Kong Exchanges and Clearing’s offer.

The FTSE 100 rose 1 per cent, its best one-day performance in nearly 10 days, while the midcap index added 1.2 per cent. London Stock Exchange took the top spot on the main bourse with a 6 per cent jump after Hong Kong Exchanges and Clearing made a surprise $39 billion takeover approach.

EUROPE

European shares hit six-week highs. Germany’s trade-sensitive DAX rose 0.74 per cent, while the pan-European STOXX 600 index gained 0.9 per cent to hit its highest since July 30th.

Shares in Prosus, a spin-off from Naspers that includes the ecommerce group's 31 per cent stake in Chinese tech giant Tencent, surged more than 25 per cent on their stock market debut in Amsterdam, creating one of Europe's largest internet companies. Europe's tech index gained 1.2 per cent.,

Gains were broad-based, with all subsectors barring oil and gas companies finishing higher. Investors have been piling into sectors that have lagged broader markets in the past days, driving the banking index higher for the sixth straight session.

All eyes are now on the ECB’s monetary policy meeting today, where it is expected to cut interest rates and restart an asset purchase programme at a time when the euro zone’s biggest economy, Germany, might be slipping towards recession. “Even if you’re not going to be short [on markets], you’re probably going to be cautiously long with the view of having more cash lined up, to buy into the market depending how dovish the ECB is,” said David Madden an analyst at CMC Markets.

NEW YORK

Wall Street moved higher on led by tariff-sensitive technology and industrial stocks after China extended an olive branch ahead of next month’s trade negotiations with the US.

The S&P 500 closed above the 3,000 mark for the first time since July 30th. Apple provided the biggest boost to the S&P 500 and the Nasdaq the day after it unveiled its latest iPhone upgrade and announced the launch date of its Apple TV+ streaming service.

The blue-chip Dow, led by Boeing, posted its sixth consecutive daily gain. Boeing, the largest US exporter by dollar value, gained 3.6 per cent.

China announced tariff exemptions for a range of US goods in a move viewed by many investors as a show of good faith just weeks ahead of planned talks aimed at resolving the trade war.

The Dow rose 227.61 points, or 0.85 per cent, to 27,137.04, the S&P 500 gained 21.54 points, or 0.72 per cent, to 3,000.93 and the Nasdaq added 85.52 points, or 1.06 per cent, to 8,169.68. – Additional reporting: Reuters, Financial Times