Global stocks rise despite trade war concerns

The EU said a raft of retaliatory tariffs will kick in Friday

London (AFP) – World stocks climbed Wednesday as investors fished for bargains, but anxiety lingered over simmering trade tensions between China and the United States, dealers said.

London won 0.8 percent, Frankfurt added 0.1 percent and Paris rose 0.2 percent in early afternoon deals, mirroring earlier gains in Asia.

Investors were tiring of trade war fears — but fresh retaliatory moves could send markets south again, dealers said.

Equities had tanked Tuesday on rising fears of a trade war after US President Donald Trump threatened fresh tariffs on Chinese imports and Beijing warned of countermeasures.

“The markets have been trading on the same piece of general trade war news for a while, as a result selling exhaustion has started to set in,” said London Capital Group analyst Jasper Lawler.

“Any fresh news of retaliation could see traders snatch risk back off the table quickly,” he warned.

– New twist –

In a new twist, a top EU official revealed that Brussels will implement Friday a raft of retaliatory tariffs against metals duties imposed by Trump.

From blue jeans to motorbikes and whiskey, the EU’s hit-list of products targeted for tariffs with the US reads like a long list of emblematic American exports.

Brussels first drew up the list in March when Trump initially floated the 25 percent tariffs on steel imports and 10 percent on aluminium, which also target Canada, Mexico and other close allies.

Canada and Mexico have also announced their own countermeasures.

In Asia on Tuesday, Shanghai and Hong Kong bore the brunt of the sell-off after Beijing warned it would retaliate in kind to Trump’s threat of tariffs on hundreds of billions of dollars’ worth of Chinese goods, amounting to much of its exports to the US.

The standoff follows weeks of fruitless talks between the world’s two biggest economies, with the White House accusing China of a string of unfair practices including cyber-theft and forced technology transfers that are hurting American jobs and companies.

– OPEC focus –

Eyes are turning to OPEC’s crucial meeting as Saudi Arabia pushes, along with non-member Russia, to raise an output ceiling that has supported oil prices for 18 months.

The two major producers are facing stiff opposition at the June 22-23 gathering from nations that have benefited from higher revenues.

“It does seem like an increase (in output) is coming,” said analyst Greg McKenna at AxiTrader. “The question is, can such a move be achieved in order to balance the interests of OPEC’s customers like the US and India while still holding the cartel together as a functioning group?”

– Key figures around 1115 GMT – 

London – FTSE 100: UP 0.8 percent at 7,664.20 points 

Frankfurt – DAX 30: UP 0.1 percent at 12,695.96

Paris – CAC 40: UP 0.2 percent at 5,402.68

EURO STOXX 50: UP 0.4 percent at 3,449.61

Tokyo – Nikkei 225: UP 1.2 percent at 22,555.43 (close)

Hong Kong – Hang Seng: UP 0.8 percent at 29,696.17 (close)

Shanghai – Composite: UP 0.3 percent at 2,915.73 (close)

New York – Dow Jones: DOWN 1.2 percent at 24,700.21 (close)

Euro/dollar: DOWN at $1.1568 from $1.1590 at 2100 GMT

Pound/dollar: UP at $1.3178 from $1.3174

Dollar/yen: DOWN at 110.04 yen from 110.06 yen

Oil – Brent Crude: DOWN three cents at $75.05 per barrel

Oil – West Texas Intermediate: UP 11 cents at $65.18