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NEW YORK: Global stocks were torn on Thursday between the impeachment firestorm surrounding US President Donald Trump and encouraging signs that the US-China trade war is cooling off.
Wall Street ended in the red after a day of intense political drama in which lawmakers released a whistleblower complaint accusing Trump of pressuring Ukraine´s new president to dig up political dirt on Democratic frontrunner Joe Biden, prompting a White House cover-up.
Karl Haeling of LBBW said the market´s response to the whistleblower complaint suggested the risk of impeachment could be somewhat higher than initially thought, but added that the modest losses showed markets remained “stable.”
Some analysts have described the market´s approach to the Ukraine case as wait-and-see.
But European stocks rose after upbeat comments from Trump had lightened the mood, coming a day after he had unveiled part of a new trade agreement with Japan.
– Sliver of optimism´ –
China´s Commerce Ministry also cheered markets, saying Chinese companies bought “considerable” quantities of American pork and soybean exports as the two countries prepare to resume high-level negotiations next month.
Connor Campbell, analyst at Spreadex trading group, said “investors chose to buy into Trump´s trade optimism, allowing the markets to push higher.”
“Investors have been ´trade war´ bearish for so long that any sliver of optimism is cheered,” Stephen Innes, Asia Pacific market strategist at AxiTrader, said in a note.
The Japanese deal also “suggests the president is open to an ´interim´ trade deal, possibly signaling he is willing to negotiate one with China,” Innes said.
Asian markets also cheered Trump´s comments on trade.
Meanwhile, crude prices were mixed after an unexpected rise in US inventories and a swift recovery in Saudi Arabia´s output following the September 14 attacks on its oil infrastructure