Trade Hopes Rekindled, EU Economy Still Slowing, Downgrades Weigh On Sentiment

Global markets rise as trades hopes are rekindled, traders are cautioned once again not to put too much faith in a Phase One Trade Deal.
Thomas Hughes

The U.S. Futures Are Marginally Higher In Early Friday Trading

The U.S. index futures are indicating a slightly higher open on Friday after Xi Jinping rekindled trade hopes. The Chinese President says China wants to make a deal but is ready to fight for a good one. The NASDAQ Composite is in the lead with a gain of 0.30% while the Dow Jones and S&P 500 are both up about 0.20%.

In stock news, shares of JM Smuckers are seesawing in early trading. The company reported mixed results and cut its full-year guidance, news that had the stock down more than -2.0% shortly after the release. By 9 AM, however, the stock had recovered much of its losses to trade just shy of break-even. Shares of Footlocker are also on the move. The shoe retailer is up more than 3.25% in the premarket session.

Later in the session traders will be on alert for Flash PMI readings. Both services and manufacturing activity is expected to expand but little to no acceleration from the previous month is in the forecast.

EU Markets Are Moving Higher

The EU indices are moving higher despite weak PMI readings from the region. The Eurozone composite PMI fell to 50.3 shedding -0.3 from the previous month. The bad news is that EU activity is slowing, the good news is that economic expansion is still underway. In the UK, both services and manufacturing PMI show contraction but less than analysts had predicted.

The German DAX is up 0.25% in early trading with the CAC slightly ahead. The UK FTSE 100 is up more than 1.30%. In stock news, basic resources are in the lead but all sectors are moving higher. Shares of ArcelorMittal are among the day’s leaders with a gain of 4.4%.

Asia Moves Higher, Trade Concerns Are In Focus

The Asian bourses closed mostly higher on Friday as traders refocus on trade. The news from China is optimistic although there is little reason to expect a trade deal before the end of the year. China has invited the U.S. back to Beijing for another round of trade talks but there is no word if the U.S. has accepted. The deadline for the Phase One deal is just over three weeks away. the Shanghai Composite is the only index to close in the red, it shed -0.63%, while most others advanced 0.25% to 0.55%.

In stock news, a series of downgrades are weighing on sentiment. Morgan Stanley cut Nintendo and its shares sank -3.5% while Westpac is moving lower on a downgrade from Morgan Stanley.

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