Stocks Falter, Trade Fear Flares Up, FOMC Announcement On Tap

The FOMC statement is due out this afternoon and will move the market, one way or another.
Thomas Hughes
Best forex broker

Global Stocks Falter In Wake Of Conflicting Trade News

U.S. futures trading was indicating a flat open in early Wednesday trading following a round of conflicting trade news. Reports the Chinese are pushing back against U.S. demands compounded fears sparked last week. Word that the Trump/Xi meeting was moved out by at least a month signals the two sides are still a long way from reaching consensus.

On a more positive note, the White House says that Trade Ambassador Robert Lighthizer and Secretary of the Treasury Steve Mnuchin will be visiting Beijing next week. The trip is the 3rd round of high-level trade talks and may be a critical turning point for the negotiation.

Traders were also cautious because of today’s FOMC policy announcement. The announcement is due out at 2 PM, there is no expectation for policy change. What is expected is a reduced dot-plot forecast and information regarding the Fed’s balance sheet. The Federal Reserve balance sheet wind down has been credited with hampering economic activity, the FOMC has previously indicated an end to the wind-down was close at hand.

May Requests Article 50 Extension

Theresa May has submitted a formal request to extend the Article 50 deadline. The deadline is less than 10 days away, if the extension is not granted the UK will be facing a hard-Brexit. Parliament has voted not to accept a hard-Brexit so it is unclear what will happen next. The EU has repeatedly stated no renegotiation would be allowed.

The UK FTSE was leading the EU equities market at midday despite the impending Brexit but gains were microscopic. The French CAC was down about -0.10% on today’s news while the German DAX shed a more substantial -1.15%. German stocks were hurt by a round of bad news for top stocks Bayer and BMW. Bayer fell -12% after a U.S. court ruled Roundup was substantially to blame for causing a mans cancer. Shares of BMW fell more than -5.0% after revealing pretax profits would fall -10%.

Asia Mixed; Growth, Trade, FOMC In Focus

Asian markets were flat to down following Tuesday’s U.S. market reversal. The reversal was caused by rising trade fears that spilled over into Thursday’s session. The Hong Kong Hang Seng led the decline with a loss of -0.49% after trading much lower intraday. The Australian ASX was the second biggest loser, shedding -0.32%, while the Korean Kospi and Shanghai Composite both closed near break-even for the day.

In stock news, Chinese mobile phone maker Xaomi reported revenue and earnings better than expected. Shares of the stock fell -4.7% however because outlook fell short of consensus. Korean chip-maker SK Hynix was among today’s biggest gainers rising nearly 3.70%. In economic news, Asian Business Confidence held steady near 3-year lows as U.S./China trade relation drag on sentiment.

Don't miss a thing!

Discover what's moving the markets. Sign up for a daily update delivered to your inbox

Latest Articles

See All

Expand Your Knowledge

See All
IMPORTANT DISCLAIMERS
The content provided on the website includes general news and publications, our personal analysis and opinions, and contents provided by third parties, which are intended for educational and research purposes only. It does not constitute, and should not be read as, any recommendation or advice to take any action whatsoever, including to make any investment or buy any product. When making any financial decision, you should perform your own due diligence checks, apply your own discretion and consult your competent advisors. The content of the website is not personally directed to you, and we does not take into account your financial situation or needs.The information contained in this website is not necessarily provided in real-time nor is it necessarily accurate. Prices provided herein may be provided by market makers and not by exchanges.Any trading or other financial decision you make shall be at your full responsibility, and you must not rely on any information provided through the website. FX Empire does not provide any warranty regarding any of the information contained in the website, and shall bear no responsibility for any trading losses you might incur as a result of using any information contained in the website.The website may include advertisements and other promotional contents, and FX Empire may receive compensation from third parties in connection with the content. FX Empire does not endorse any third party or recommends using any third party's services, and does not assume responsibility for your use of any such third party's website or services.FX Empire and its employees, officers, subsidiaries and associates, are not liable nor shall they be held liable for any loss or damage resulting from your use of the website or reliance on the information provided on this website.
RISK DISCLAIMER
This website includes information about cryptocurrencies, contracts for difference (CFDs) and other financial instruments, and about brokers, exchanges and other entities trading in such instruments. Both cryptocurrencies and CFDs are complex instruments and come with a high risk of losing money. You should carefully consider whether you understand how these instruments work and whether you can afford to take the high risk of losing your money.FX Empire encourages you to perform your own research before making any investment decision, and to avoid investing in any financial instrument which you do not fully understand how it works and what are the risks involved.
FOLLOW US