|14 August, 2019

Wednesday outlook: Stock markets rebound as US delays China tariffs

MSCI's broadest index of Asia-Pacific shares outside Japan rose 0.9 percent and US stocks rallied overnight

Traders work on the floor at the New York Stock Exchange (NYSE) in New York, U.S., July 1, 2019.

Traders work on the floor at the New York Stock Exchange (NYSE) in New York, U.S., July 1, 2019.

REUTERS/Brendan McDermid
  • Asian shares rise on tariffs delay
  • Oil prices retreat after Tuesday’s rally
  • Egyptian shares outperform on Thursday
  • Dollar, gold price mainly unchanged

Global markets

Asian shares rose early on Wednesday, tracking a surge on Wall Street overnight, as the US President Donald Trump delayed his September 1 deadline for 10 percent tariffs on the remaining Chinese imports.

MSCI’s broadest index of Asia-Pacific shares outside Japan rose 0.9 percent and US stocks rallied overnight as the S&P 500 rose 1.5 percent on Tuesday.

“President Trump did delay the tariffs and while this is positive for equities, the markets will remain wary of the tariffs still being implemented come December,” Masahiro Ichikawa, senior strategist at Sumitomo Mitsui DS Asset Management, told Reuters.

Oil prices

Oil prices retreated early on Wednesday as data showed a surprise rise in US inventories. In the previous session, prices surged by as much as 5 percent after Washington said it would delay tariffs on some Chinese goods.

Brent crude was down 35 cents on Wednesday, or 0.6 percent, at $60.95 a barrel at 0116 GMT. US oil was down 46 cents, or 0.8 percent, at $56.64 a barrel.

Crude inventories increased by 3.7 million barrels to 443 million, last week, compared with analyst expectations for a decrease of 2.8 million barrels, Reuters reported citing data from American Petroleum Institute (API).

Middle East markets

Most stock markets in the region were closed for at least the first three days of this week due to Eid al-Adha holidays. The Saudi stock market will be closed for the entire week.

On Thursday, Egypt’s blue-chip index EGX30 was the best performer in the region, adding 2.2 percent, with Commercial International Bank adding 1.2 percent.

Dubai's index closed 0.2 percent higher with Emaar Properties gaining 1.9 percent and Air Arabia climbing 3.5 percent.

In Abu Dhabi the index fell back 0.4 percent. Emirates Telecommunications Group slipped 0.9 percent and Abu Dhabi Commercial Bank dropped 1.6 percent.

Trading on UAE stock markets resumes today.

Saudi Arabia’s index gained 0.8 percent. Banks led the gains with Riyad Bank adding 3.5 percent and Saudi British Bank leaping 4.8 percent.

Qatar's index was also down 0.6 percent. Banks were biggest drag on the index with Commercial Bank dropping 3.6 percent, while Qatar Gas Transport traded 3.5 percent lower.

Bahrain’s index was flat, Kuwait’s premier market index fell 0.4 percent and Oman’s index added 0.6 percent.

Currencies

The dollar was mainly unchanged on Wednesday.

The dollar index .DXY, which measures the greenback against a basket of six major currencies retreated 0.05 percent to 97.759 after advancing nearly 0.5 percent the previous day.

Precious metals

Gold prices firmed early on Wednesday.

Spot gold was up 0.1 percent at $1,502.03 per ounce at 0047 GMT.

U.S. gold futures fell 0.1 percent to $1,513.10 an ounce.

(Reporting by Gerard Aoun; Editing by Seban Scaria)

(gerard.aoun@refinitiv.com)


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© ZAWYA 2019

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