Battered global shares struggle to find their footing

That helped Chinese stocks pare losses, with both Shanghai Composite index and Hong Kong’s Hang Seng index down 0.8%. Earlier in the day, Shanghai was down as much as 1.9% while Hong Kong was off 1.7%. Japan’s Nikkei average closed 0.1% lower in choppy trade, with the benchmark falling as much as 1.5% before a brief swing into positive territory on China news.

The euro rose 0.3% and the offshore Chinese yuan gained 0.8% following China-US trade talk news. US stock futures rose 0.4%.

“The news [of the China-US trade talks] triggered short-covering but I think fundamentally it is of limited significance,” said Yasuo Sakuma, chief investment officer at Libra Investments.

Sakuma said Turkey’s market swings reflect the fact that it is one of the more vulnerable parts of the global economy at this stage in the interest rate cycle, as the Federal Reserve seeks to normalise its monetary policy.

However, he noted there were arguably larger risks for investors, such as weak earnings from Tencent Holdings.

The Chinese tech giant reported its first quarterly profit fall in nearly 13 years on weak gaming revenue — it holds a 40% stake in the US firm that makes cult game Fortnite.

That had knocked other Asian tech firms with South Korea’s Samsung Electronics, Asia’s third-largest firm by market cap, down to a one-year low.

Although metals strengthened, oil prices were left flat after data showed a surprise weekly increase in US crude stockpiles, compounding worries about a weaker global economic growth.

Brent was at just over $70 a barrel and US crude oil last stood at $65.12 a barrel, having fallen to two-month lows of $64.42 a barrel, following Wednesday’s 3.2% fall.

The tentative recovery in risk appetite also saw bond benchmark German bund and US treasury yields, which move inverse to the bond’s price, nudge up.

Reuters

Source: businesslive.co.za