European Shares Edge Up After Mixed Session in Asia
January 16 2019 - 4:39AM
Dow Jones News
By David Hodari
Global stocks wavered Wednesday as investors absorbed a fresh
dose of uncertainty over the U.K.'s attempts to leave the European
Union.
The Stoxx Europe 600 was up 0.3% with mild, broad-based gains in
opening trading. The index's banking sector climbed 0.9% after its
Italian constituents came under pressure Tuesday, following reports
that the European Central Bank wants them to clean up their bad
loans more effectively.
British assets gave a tepid reaction to the U.K. parliament's
overwhelming rejection of Prime Minister Theresa May's proposed
Brexit deal late Tuesday. The defeat was the largest suffered by a
sitting British government since at least the beginning of the 20th
century.
The FTSE 100 ticked down 0.3%, underperforming other European
benchmarks, as the British pound edged up 0.1% against the U.S.
dollar, and falling by the same amount against the euro. Market
participants saw a lower likelihood of the country leaving the
European Union without a deal.
"The probability of a softer Brexit or remaining in the EU has
gone up more than anything else as a result of the vote in
parliament last night, and that offsets persistent uncertainty,"
said John Wraith, head of U.K. rates strategy and economics at
UBS.
The yield on 10-year U.K. government debt was rose to 1.287%
from 1.259% late Tuesday. Yields rise as prices fall.
The gains in stocks across much of Europe followed mixed trading
in Asia. Japan's Nikkei benchmark ticked 0.6% lower after hitting a
four-week high Tuesday, while the Shanghai Composite Index was flat
and the Shenzhen A-Share fell 0.1%. Hong Kong's Hang Seng gained
0.3%.
In the U.S., futures pointed to gains of 0.3% for the S&P
500 and the Dow Jones Industrial Average. On Tuesday tech stocks
had led Wall Street higher following the People's Bank of China's
move to reassure markets of its intention to support waning
economic growth in the world's second-largest economy.
A slew of gloomy economic figures out of China in recent weeks
have concerned investors about the state of broader global growth,
although an acceleration in the rise of Chinese house prices
soothed those jitters.
In commodities, Brent crude oil was up 0.3% at $60.84 a barrel,
while gold climbed 0.2% to $1,290.45 a troy ounce.
Write to David Hodari at David.Hodari@wsj.com
(END) Dow Jones Newswires
January 16, 2019 04:24 ET (09:24 GMT)
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