Stocks meander on caution over trade talks, dollar gains
(Adds close of U.S. markets)
* China trade data adds to signs of weakness in economy
* Asian stocks gain, European and U.S. shares fall
By Herbert Lash
NEW YORK, Oct 14 (Reuters) - The U.S. dollar gained on
Monday as optimism ebbed over a potential U.S.-China trade deal
that President Donald Trump outlined last week, while a gauge of
global equity markets was little changed as investors sought
details about an agreement.
Gold gained and oil prices fell more than 3% at one point as
scant information about the first phase of a Sino-U.S. trade
deal undercut optimism over a thaw in the dispute that has
sparked a slowdown in global growth.
A slide in Chinese exports picked up pace in September while
imports contracted for a fifth straight month, evidence of
further weakness in China's economy as tariffs take their toll.
China's exports fell 3.2% from a year earlier in September,
the biggest fall since February, customs data showed.
MSCI's gauge of stocks across the globe shed
0.12% while the FTSEurofirst 300 index of leading
regional shares closed down 0.45%.
Stocks closed lower on Wall Street after trading on either
side of break-even during the session.
The Dow Jones Industrial Average fell 29.23 points,
or 0.11%, to 26,787.36. The S&P 500 lost 4.12 points, or
0.14%, to 2,966.15 and the Nasdaq Composite dropped 8.39
points, or 0.1%, to 8,048.65.
"You're pivoting from what was trade escalation in August
and parts of September to trade de-escalation which markets
celebrated at the end of last week," said Michael Arone, chief
investment strategist at State Street Global Advisors in Boston.
"Now moving forward it's going to be about what exactly has
been agreed to?"
Investors are awaiting more details on trade negotiations,
talks over Britain's departure from European Union and the
release starting later this week of third-quarter earnings
results, Arone said.
"I expect 2020 expectations to continue to be lowered and
that could be a challenge to the market moving forward," he
The U.S. benchmark S&P 500 ended Friday with its first
weekly gain in a month after Trump signaled that Washington and
Beijing had taken the first major step in easing tit-for-tat
Euro zone bond yields fell as caution regarding the trade
talks encouraged investors back into fixed income after a hefty
sell-off on Friday that sent borrowing costs to 2-1/2 month
Trading in U.S. Treasuries was closed for the Columbus Day
Earlier in Asia, stock markets cheered news of a trade
agreement. China's blue-chip CSI300 index gained 1.1%
while the Shanghai Composite Index rose 1.2%.
Markets in Tokyo were closed.
The greenback, Swiss franc and Japanese yen all weakened as
optimism over the trade talks, together with the European Union
and Britain restarting Brexit negotiations, encouraged investors
into riskier assets.
The dollar index rose 0.23%, with the euro
down 0.15% to $1.1023. The Japanese yen strengthened 0.02%
versus the greenback at 108.40 per dollar.
Sterling fell 0.74% to $1.2554, retreating from a
15-week high of $1.2708 on Friday, on optimism Britain could
reach a deal on Brexit with the EU.
A Brexit deal was hanging in the balance after diplomats
indicated the EU wanted more concessions from Prime Minister
Boris Johnson and that a full agreement was unlikely this week.
Oil futures fell about 2%, paring bigger losses earlier.
Brent crude dropped $1.16 to settle at $59.35 a
barrel, while U.S. West Texas Intermediate (WTI) crude
settled down $1.11 to $53.59 a barrel.
U.S. gold futures settled 0.6% higher at $1,497.6 an
(Reporting by Herbert Lash in New York
Editing by Matthew Lewis and Tom Brown)
First Published: 2019-10-14 02:33:54
Updated 2019-10-14 22:42:50
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