Global Stocks Edge Higher in Absence of Fresh Shocks

Date : 11/19/2019 @ 2:11PM
Source : Dow Jones News

Global Stocks Edge Higher in Absence of Fresh Shocks

By Anna Isaac 

Global stocks edged higher Tuesday as investors grew less apprehensive about the economic outlook and the prospects for a U.S.-China trade deal in the absence of fresh shocks.

Futures tied to the Dow Jones Industrial Average index ticked up about 0.2%, suggesting that the gauge may reach a new record when New York markets open. Hong Kong's Hang Seng Index ended the day up almost 1.6%, while the Shanghai Composite gauge advanced 0.9%.

U.S. stocks have had a relatively muted start to the week -- even as the key equity benchmarks closed at fresh records Monday -- as recent economic data and companies' earnings results didn't prompt fresh concerns about the economy. Investors are taking a more neutral stance in their assessment of risks, rather than a defensive position, according to Florian Ielpo, head of macroeconomic research at asset-management firm Unigestion.

"Markets were thinking a recession was imminent at the end of August, now people are discovering that it is less bad than that," Mr. Ielpo said. "Pessimism is starting to fade."

Ahead of the opening bell in New York, Home Depot dropped 3.9% in premarket trading after the retailer trimmed its expectations for sales growth. Shares in smaller rival Kohl's Corp. dropped over 12% after it lowered its profit guidance for the year.

The disappointing outlook from both companies weighed on the stocks of other U.S. retailers, as investors grew concerned about the health of a sector that has been strong so far this year. Macy's Inc., which is scheduled to report earnings later in the week, fell 5.5% while Nordstrom Inc. declined 4.9%. Gap Inc. slumped 2.3%.

The ICE dollar index, which tracks the greenback against a basket of currencies, dropped sharply immediately after President Trump said he met with Federal Reserve Chairman Jerome Powell at the White House Monday and "protested" about U.S. interest rates being too high. The gauge has pared back most of those losses in the hours since.

Mr. Trump, who has been vocal in his criticism of the central bank, tweeted that he discussed the state of the economy, trade issues, and the impact of a "too strong" dollar with the central bank chief. The Fed said Mr. Powell reiterated that he hoped interest-rate cuts earlier this year would bolster the economy. The yield on the U.S. 10-year Treasurys rose to 1.819%, from 1.808% on Monday.

Meanwhile, the pan-continental Stoxx Europe 600 index rose 0.5%. The biggest gainer in European equities was the U.K.'s Halma, which gained about 10% after the safety-equipment and hazard-detection group reported better-than-expected first-half results.

Shares in satellite firm SES SA dropped over 20% in Paris after Federal Communications Chairman Ajit Pai said he would back a public auction to free up spectrum on 5G networks. The company and rival Intelsat SA had been lobbying for a private auction of the so-called C-band spectrum, which is used to deliver videos and radio programs to U.S. households.

Write to Anna Isaac at anna.isaac@wsj.com

 

(END) Dow Jones Newswires

November 19, 2019 08:56 ET (13:56 GMT)

Copyright (c) 2019 Dow Jones & Company, Inc.


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