Global stocks fall on China economic weakness, tempered trade hopes

  • 20:36 28 February 2019

Global stocks fall on China economic weakness, tempered trade hopes

Global equities markets fell for a third straight day on Thursday, with Wall Street stocks edging lower as weak Chinese economic data and mixed messages on the progress of trade talks between China and the United States weighed on investor sentiment, ONA reports citing Reuters.

Data showed that Chinese factory activity contracted to a three-year low and that China’s export orders fell at their fastest pace since the global financial crisis a decade ago. The data added to consistent worries about a slowdown in the Chinese economy and its impact on global markets.

Receding optimism on the U.S.-China Trade talks also dampened sentiment.

U.S. Trade Representative Robert Lighthizer said his office was taking legal steps to implement President Donald Trump’s announcement on Sunday to delay a tariff increase on more than $200 billion worth of Chinese goods that had been scheduled for Friday. But the office later issued a statement clarifying that it was not abandoning the threat of increasing the tariffs to 25 percent from 10 percent.

The major U.S. stock indexes dipped, though the pan-European STOXX 600 pared losses to trade little changed. Concerns about China also weighed on emerging market stocks, with the MSCI International EM Price Index down 1.0 percent.

“The negative PMI number is certainly of concern,” said Tim Ghriskey, chief investment strategist at Inverness Counsel in New York, referring to the weak Chinese economic data. “It paints a question mark globally because China is a huge economy.”

Earlier, news of the break-up of the summit between Trump and North Korean leader Kim Jong Un on denuclearization triggered flight-to-quality bids in lower-risk assets. The Japanese yen gained 0.3 percent against the dollar.

Faig Mahmudov