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May 22, 2018

Asia, Europe an U.S. Stock Markets Report - May 22,2018 - Markets I CNBC


Stocks in Asia close mixed as investors digest rising oil prices and trade news

Cheang Ming

Asian markets were subdued on Tuesday, with Japan and Australia finishing slightly lower while China advanced as oil prices edged higher.
In Japan, the Nikkei 225 tracked lower by 0.18 percent, or 42.03 points, to close at 22,960.34 despite starting the session with slight gains. The broader Topix slipped 0.23 percent, with most of its 33 subsectors finishing insurers led losses.
Several index heavyweights, however, clung to gains, with Fanuc higher by 0.88 percent and Fast Retailing rising 0.55 percent by the end of the day.
Markets over in China, however, closed in positive territory after getting a boost late in the session. The Shanghai composite was little changed, up 0.02 percent at 3,214.53 and the Shenzhen Composite tacked on 0.38 percent to end at 1,855.16.


-42.03 -0.18%
HSI HSI 31234.35
186.44 0.60%
ASX 200 S&P/ASX 200 6041.90
-42.60 -0.70%
SHANGHAI Shanghai 3214.53
0.69 0.02%
KOSPI KOSPI Index 2465.57
4.92 0.20%
CNBC 100 CNBC 100 ASIA IDX 8667.37
8.94 0.10%
Elsewhere, Australia's S&P/ASX 200 declined 0.7 percent to 6,041.90 amid broad-based losses in most sectors. The country's "Big Four" banks mostly finished the day lower, as did major miners. ANZ fell 1.59 percent, leading losses among its peers, while BHP closed down 0.68 percent.
MSCI's index of shares in Asia Pacific excluding Japan, meanwhile, edged higher by 0.15 percent in Asia afternoon trade. Markets in Hong Kong and South Korea were closed on Tuesday for a holiday.
Developments in the trade relationship between the U.S. and China have been in focus for investors. In particular, the Wall Street Journal reported on Tuesday that the U.S. could lift its ban on U.S. companies selling technology to Chinese telecommunications equipment maker ZTE.
That came after U.S. Treasury Secretary Steven Mnuchin told CNBC on Monday that the most recent round of bilateral trade talks with China had "made very meaningful progress" and that it was now up to both parties to implement what had been discussed. Mnuchin's Sunday comment that a trade war between the countries was "on hold" had cheered global markets on Monday.
Despite the broader sense of calm in markets now that trade tensions between the world's two largest economies had eased, some still expected the better outlook to be subject to change.
The U.S. "could easily come back with accusations of insufficient change at a moment's notice, probably at a time when it suited them, the mid-term election in November for example," Robert Carnell, chief economist of ING, said in a note.
The mixed session in the region also came on the back of U.S. stocks closing higher, with the Dow Jones industrial average finishing the session above the 25,000 mark for the first time since mid-March.
On the commodities front, oil prices were slightly higher after touching their highest levels in three and a half years overnight. Markets were concerned over U.S. sanctions targeting Venezuela following the latter's recent election, the results of which were widely condemned.
U.S. crude futures edged up 0.36 percent to $72.50 per barrel and Brent crude futures added 0.19 percent to trade at $79.37.
The dollar index, which tracks the U.S. currency against a basket of peers, traded at 93.620. Against the yen, the dollar firmed to trade at 111.07 at 2:38 p.m. HK/SIN, compared to levels around the 110 handle seen last week.
The euro, which earlier got some reprieve after taking a hit on recent uncertainty in Italian politics, slipped to trade at $1.1762.
In corporate news, Sony said it had reached an agreement to acquire Mubadala Investment's stake in EMI Music Publishing for $1.9 billion. Sony shares were down 1.97 percent, paring steeper declines seen earlier.

Europe closes higher amid earnings; autos gain on China tariff cut; Altice rallies 19%

Sam Meredith, Ryan Browne

European stocks closed higher Tuesday, as China said it would reduce tariffs on cars and auto parts and pressure on Italian markets eased.


FTSE FTSE 7877.45
18.28 0.23% 832614711
DAX DAX 13169.92
92.20 0.71% 112491211
CAC CAC 5640.10
2.59 0.05% 85182869
IBEX 35 --- --- --- --- --- ---
The pan-European Stoxx 600 closed up 0.27 percent, with most sectors and major bourses in positive territory.
Italian government bond yields came off 14-month highs on Tuesday, after several days of heavy selling amid concerns about a potential new governing coalition. The proposed link-up of anti-establishment parties had lifted Rome's 10-year yields up nearly 70 points since the start of the month.
Autos were among those to lead the gains, up almost 1 percent after China's Finance Ministry said it would cut the import duty on passenger cars to 15 percent from current levels of 25 percent. The announcement, which came Tuesday, also said tariffs on some automotive parts would fall to 6 percent. Schaeffler and BMW were trading more than 2.5 percent higher following the news.
Telecoms stocks were also among Europe's top performers after the chief of France's telecoms regulator told Le Monde that he was open to consolidation in the sector, re-igniting talk of telecom deals. Altice rose to the top of the sector, up more than 19 percent.
Looking at individual stocks, Fischer surged near the top of the European benchmark after UBS upgraded its stock recommendation to a "buy." Its shares were more than 7 percent higher.

Oil prices edge higher 

On Wall Street, stocks opened higher, building on strong gains from the previous session.
Meanwhile, surging oil prices ignited market participants' concerns about a flare-up in inflation and faster-than-expected U.S. interest rate increases.
Oil prices rose amid concerns over Venezuela's crude output following a disputed presidential vote. Brent crude traded at $80.40 a barrel, up more than 1 percent, while WTI stood at $72.67, over 0.6 percent higher.
Total Votes:
Not a Scientific Survey. Results may not total 100% due to rounding.
Bank of England Governor Mark Carney said the U.K. economy would bounce back from a weak start to the year. He denied claims that the central bank had confused investors and households by deciding not to hike interest rates earlier this month.


Dow drops nearly 200 points after Trump says he's not happy with China trade talks

Fred Imbert, Silvia Amaro

U.S. stocks dropped on Tuesday after President Donald Trump said a highly anticipated summit with North Korea may not happen after all.
The Dow Jones industrial average fell 200 points as Boeing shares declined 2.5 percent, while the S&P 500 and Nasdaq composite lost 0.4 percent and 0.3 percent, respectively.
"Whether or not it happens, you'll be knowing pretty soon," Trump told reporters at the White House. The summit with North Korean leader Kim Jong Un is scheduled for June 12 in Singapore.
"There's a lot of uncertainty right now and that's reflected in the tight trading band we've been in for the past few months," said Jennifer Ellison, principal at Bingham, Osborn & Scarborough.
Stocks traded higher earlier in the session after China said it will reduce levies on automakers and car parts. China's Finance Ministry said tariffs on certain vehicles will come down to 15 percent from as much as 25 percent while levies on some parts will be brought down to 6 percent effective July 1.
Shares of Ford and General Motors rose on the news, gaining 0.1 percent and 0.5 percent, respectively. Tesla initially rose more than 1 percent before sliding 3.3 percent.
Spencer Platt | Getty Images News | Getty Images
"We may already be getting some relief on one of the major issues that has weighed on the market since early February, when President Donald Trump threatened to impose tariffs on the US's major trading partners," Ed Yardeni, president and chief investment strategist at Yardeni Research.
The announcement by China comes after Treasury Secretary Steven Mnuchin told CNBC on Monday the U.S. has made "very meaningful progress" with China on trade matters, noting: "Now it's up to both of us to make sure that we can implement it."
Mnuchin's comments helped push the Dow up nearly 300 points as Wall Street interpreted the remarks as tensions between the U.S. and China easing. The Dow also closed above 25,000 for the first time since March on Monday.
Rising trade tensions between the U.S. and China, coupled with rising rates and inflationary fears, pushed stocks off of record highs earlier this year. Since then, the major indexes have recovered slightly from those losses.
However, Steve Chiavarone of Federated Investors said he was not too worried about the rising tensions between the two giant economies, noting the amount of money in tariffs proposed is far smaller than the benefit of lower taxes. "It's like 20 to 1," the firm's assistant vice president said.

Watch: The market's 'fear gauge' may be signaling caution for stocks

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