logo
Plus   Neg
Share
Email

European Shares Likely To See Cautious Start

asian-markets2_13aug19.jpg

European stocks look set to open on a cautious note on Tuesday, with a pronounced drop in the yuan, escalating protests in Hong Kong and surprise primary election results in Argentina, which resulted in a rout in the country's peso currency, likely to keep investors nervous.

The Italian Senate will meet today to set a crucial date for a no-confidence vote that could spell the end of Prime Minister Giuseppe Conte's populist government.

Asian markets slipped into the red as China bank lending data disappointed and the People's Bank of China guided the yuan lower for a ninth straight session, adding to fears of a global currency war. The new U.S. tariffs on some $300 billion in Chinese imports would go into effect on Sept. 1.

Meanwhile, China has warned of potential terrorism arising from increasingly violent protests in Hong Kong as the situation gets worse and worse.

Operations resumed at Hong Kong airport on Tuesday morning, a day after a
pro-democracy protest brought the air transport hub to a complete standstill.

Hong Kong leader Carrie Lam said on Tuesday the lawbreaking activities in the name of freedom were damaging the rule of law and that it could take a long time for the city to recover from the protests.

Elsewhere, fears of a full-blown financial crisis in Argentina have once again come rushing to the fore after a plunge in Argentine assets in the wake of
President Mauricio Macri's stunning rout in primary elections over the weekend.

Safe haven assets such as the Japanese yen, gold and bonds are on the rise on risk-off sentiment while oil prices fell slightly on worries about sluggish economic growth.

In economic releases, labor market data from the U.K. and Germany's ZEW economic sentiment survey results are due later in the session, headlining a light day for the European economic news.

Overnight, U.S. stocks fell sharply as investors fretted about the path of U.S.-China trade negotiations and the global economic outlook.

The Dow Jones Industrial Average tumbled 1.5 percent, while the S&P 500 and the tech-heavy Nasdaq Composite slid around 1.2 percent.

European markets ended Monday's session lower, with political uncertainty in Italy, violent protests in Hong Kong and lingering worries about the U.S.-China trade dispute weighing on markets.

The pan European Stoxx 600 declined 0.3 percent. The German DAX slipped 0.1 percent, France's CAC 40 index eased 0.3 percent and the U.K.'s FTSE 100 shed 0.4 percent.

For comments and feedback contact: editorial@rttnews.com

Business News

Follow RTT