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Europe edges up, China shares outperform; oil, copper advance
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U.S. exchanges closed for holiday; dollar steadies after loss
Stocks edged up in Europe and Asian shares increased to their highest level since October as optimistic signs on China’s economy and trade discussions put global growth concerns on hold. Commodities from oil to copper rallied.
Even with fresh economic optimism in Asia, trade continues to dominate global markets as the economic superpowers race to reach a deal that would avert a tariff increase on Chinese goods by March 1, a deadline President Donald Trump has said he may extend. Over the weekend Trump said the talks were “very productive.” President Xi Jinping also sounded upbeat, reportedly saying the latest round of meetings “achieved important progress in another step.”
“With a weakening U.S. economy, the motivation for both sides to get something agreed in the short term is quite high as they still debate the more structural issues that lurk in the background,” Sunny Bangia, a global equities fund manager at Antipodes Partners Ltd., told Bloomberg TV in Sydney.
Investors may also get further guidance on monetary policy this week. Minutes from the Federal Reserve’s most recent meeting will likely show how much conviction there was among policy makers to suspend their interest-rate hiking campaign. European Central Bank President Mario Draghi speaks on Friday after the euro-area economy has repeatedly fallen short of expectations.
Elsewhere, the pound edged higher as Prime Minister Theresa Mayprepared for a return to Brussels for more talks with European Union leaders. Emerging-market assets climbed.
Here are some key events coming up:
- The Federal Reserve will on Wednesday publish minutes from its recent meeting. Bloomberg Economics thinks officials aimed to over-correct to avoid a repeat of the negative reaction to December’s statement, so a focal point will be how much the hawks were on board with the switch.
- Bank of Canada Governor Stephen Poloz speaks on Thursday and Reserve Bank of Australia Governor Philip Lowe gives parliamentary testimony on Friday.
- Australia’s central bank releases meeting minutes on Tuesday.
- Australia jobs data is due Thursday.
- Indonesia rate decision is also due Thursday.
These are the main moves in markets:
Stocks
- The Stoxx Europe 600 Index increased 0.1 percent as of 8:10 a.m. London time, the highest in almost 19 weeks.
- The Shanghai Composite Index jumped 2.7 percent on the biggest jump in more than 15 weeks.
- The MSCI Asia Pacific Index increased 1.1 percent on the largest climb in more than two weeks.
Currencies
- The Bloomberg Dollar Spot Index advanced 0.1 percent.
- The euro was unchanged.
- The British pound gained 0.1 percent to the strongest in more than a week.
- The MSCI Emerging Markets Currency Index increased 0.2 percent, the largest climb in more than two weeks.
- The Indian rupee sank 0.3 percent to 71.47 per dollar, the weakest in more than a week.
Bonds
- Germany’s 10-year yield gained less than one basis point to 0.11 percent.
- Britain’s 10-year yield increased less than one basis point to 1.163 percent.
- Australia’s 10-year yield advanced four basis points to 2.1425 percent.
Commodities
- The Bloomberg Commodity Index climbed 1.2 percent on the biggest surge in almost eight weeks.
- Iron ore gained 1.3 percent to $86.00 per metric ton.
- West Texas Intermediate crude rose 0.7 percent to $55.97 a barrel on its fifth consecutive advance.
By Adam Haigh and Todd White
— With assistance by Reade Pickert, Simon Kennedy, and Cormac Mullen
February 18, 2019, 7:27 PM GMT+11
Source: Bloomberg