Global markets falter on US tax cut doubts, oil glut fears

0
24



NEW YORK – Global stocks were pressured Tuesday by nagging doubts about US tax reform and worries about a petroleum glut.

Equity markets fell in New York, Paris and Frankfurt and treaded water in London and Tokyo. 

Analysts fear the weakness of recent days could hearken a deeper pullback after a series of stock market records over the last month.

There are signs “that markets are starting to look a little overextended,” Oanda analyst Craig Erlam said. 

Following a relatively uninterrupted rally in equity markets over the last couple of months, many market observers now are beginning to “question whether a correction of some kind is both warranted and healthy,” Erlam said.

“Despite another strong earnings season, the rally has stalled which suggest we may now be a levels again that investors can’t justify going far above, which may leave them susceptible to a pull back, even one that isn’t particularly large,” he said. 

Meanwhile, analysts said key differences between the tax bills proposed by the US House and Senate could drag out the long-anticipated proposal, a key aspect of President Donald Trump’s economic growth agenda. There have been worries in particular over a Senate provision that would put off promised steep corporate tax cuts for a year.

Investor conviction is being “stymied by festering US tax reform skepticism,” according to a market note from Charles Schwab. 

Analysts also said lackluster Chinese economic data and a bearish oil report from the International Energy Agency weighed on sentiment.

The IEA warned that crude markets were expected to be oversupplied in the current quarter and going into 2018. That sent shares of Apache, Halliburton and Schlumberger down around 3 percent or more.

Bourses in Frankfurt and Paris declined after the euro rallied following stronger-than-expected German growth data.

But London managed to hold steady, propped up by bright news from supermarket giant Tesco, which gained 5.3 percent after winning approval from British competition regulators for its £3.7-billion takeover of wholesaler Booker; and mobile phone titan Vodafone, which jumped 5.1 percent after swinging to a profit for the first half of its fiscal year after reporting a big loss in the year-ago period.

Back in the US, General Electric continued to sink after new chief executive John Flannery’s turnaround plan, unveiled Monday, disappointed investors. Shares dropped another 5.9 percent after losing more than 7.0 percent Monday.

Toymaker Mattel jumped 5.1 percent amid reports it was approached by rival Hasbro about a possible takeover. Hasbro shed 0.9 percent.

KEY FIGURES AROUND 2145 GMT (5:45 a.m. Wednesday in Manila)

New York – DOW: DOWN 0.1 percent at 23,409.47 (close)

New York – S&P 500: DOWN 0.2 percent at 2,578.87 (close)

New York – Nasdaq: DOWN 0.3 percent at 6,737.87 (close)

London – FTSE 100: FLAT at 7,414.42 (close) 

Frankfurt – DAX 30: DOWN 0.3 percent at 13,033.48 (close)

Paris – CAC 40: DOWN 0.5 percent at 5,315.58 (close)

EURO STOXX 50: DOWN 0.5 percent at 3,556.38

Tokyo – Nikkei 225: FLAT at 22,380.01 (close)

Hong Kong – Hang Seng: DOWN 0.1 percent at 29,152.12 (close)

Shanghai – Composite: DOWN 0.5 percent at 3429.55 (close)

Euro/dollar: UP at $1.1792 from $1.1665 

Dollar/yen: DOWN at 113.43 yen from 113.63 yen 

Pound/dollar: UP at $1.3166 from $1.3116

Oil – Brent North Sea: DOWN 95 cents at $62.21 per barrel

Oil – West Texas Intermediate: DOWN $1.06 cents at $55.70 per barrel 

© Agence France-Presse



All Credit Goes There : Source link

Comments

comments