Global Stocks Waver as Trade War Weighs on Chinese Exports

Date : 12/09/2019 @ 1:53PM
Source : Dow Jones News

Global Stocks Waver as Trade War Weighs on Chinese Exports

By Paul J. Davies 

Global stocks began the week with tepid declines as fresh economic data showed a sharp decline in Chinese exports to the U.S., highlighting the impact of the trade war between the world's two largest economies.

Futures tied to the S&P 500 index edged down about 0.1% following a rise Friday after a surprisingly upbeat monthly jobs report signaled strength in the U.S. economy. The Stoxx Europe 600 ticked down 0.2% Monday, while the Shanghai Composite Index ended the day up less than 0.1%.

China's exports unexpectedly dropped 1.1% in November from a year earlier, while shipments to the U.S. fell 23%, data from the General Administration of Customs showed Sunday. Uncertainty about the trade talks between the two nations has weighed on global trade and the economic outlook for much of this year, and made markets jittery.

With a new round of tariffs poised to go into effect Sunday on imports from China, a commerce ministry official said Monday that China hopes trade negotiations with the U.S. will result in a "satisfactory" outcome as soon as possible. Some analysts expect Mr. Trump to delay imposing new tariffs while negotiators are pursuing a deal. His economic adviser, Larry Kudlow, said Friday that there were "no arbitrary deadlines" to complete a limited trade deal.

"Avoiding a total breakdown remains the most important outcome for investors," said Geoffrey Yu, head of the U.K. investment office at UBS Wealth Management. "Expectations are somewhat contained, so even if there is something before the 15th, it may not herald a new bull market or unleash an upswing in investment and/or GDP growth globally."

Among European stocks, Tullow Oil was the biggest loser on Monday. The stock dropped more than 60% after the energy company cut production forecasts and its chief executive resigned with immediate effect.

Elsewhere in Asia, the Nikkei 225 index rose 0.3% after data showed the Japanese economy grew faster than expected in the third quarter. Gross domestic product expanded by an annualized 1.8% in the three months ended Sept. 30, surpassing a preliminary official estimate of 0.2%.

Over in the U.K., the FTSE 250 index of stocks dropped 0.4% as Britain prepares to vote in Thursday's crucial general election, which will set the country's course for how or whether it leaves the European Union. Polls suggest the ruling Conservative Party is set to win, though a recent narrowing of the lead is enough to keep the outcome uncertain. The pound rose 0.1% to $1.315, its highest since April.

Later this week, the U.S. and European central banks are both holding meetings to review interest rates, but neither is expected to announce any change in policy.

Write to Paul J. Davies at paul.davies@wsj.com

 

(END) Dow Jones Newswires

December 09, 2019 08:38 ET (13:38 GMT)

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


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