Global Markets: Stocks, emerging market currencies up on U.S.-China trade talk plan

Global Markets: Stocks, emerging market currencies up on U.S.-China trade talk plan

By April Joyner

NEW YORK (Reuters) - U.S. stocks and emerging market currencies rebounded on Thursday after China said it will hold trade talks with the United States later in August and Turkey's lira continued its recovery run.

U.S. equities rose on hopes that Beijing and Washington may resolve a conflict that has roiled financial markets since early March. China on Thursday said a delegation led by its vice commerce minister would travel to the United States for talks.

The dollar dipped on news of the U.S.-China talks as investors returned to currencies that had been sold off. The Chinese yuan gained 1.1 percent to 6.87 per dollar. The euro rose 0.3 percent after closing the previous day at its lowest point since July 2017.

The Turkish lira rose 3.0 percent to 5.79 per dollar, supported by Qatar's pledge on Wednesday to invest $15 billion in Turkey.

Other emerging market currencies, such as Russia's ruble and Mexico's peso, also rose. [EMRG/FRX]

The retreat in the dollar also steadied global equities. MSCI's index of world stocks rose 0.7 percent. Emerging market stocks, which on Wednesday had fallen more than 20 percent from their January intraday high, edged up 0.0 percent.

Metals markets moved higher as well. Copper rose 1.97 percent to $5,915.00 a tonne, after having confirmed a bear market on Wednesday, closing 20.9 percent lower than its recent high reached on June 7.

"Investors around the world have been anxious about the U.S.-China trade dispute and its potential impact on global growth," said Kate Warne, investment strategist at Edward Jones in St. Louis. "Anything that means investors are less concerned about slowing growth in China is good news for emerging markets and good news for parts of the commodities complex."

Turkish Finance Minister Berat Albayrak held a conference call in which he assured international investors that the country would emerge stronger from its currency crisis and that its banks were healthy. Albayrak also said Turkey had no plans to seek help from the International Monetary Fund or impose capital controls to stop money flowing abroad.

"I'm not seeing any sign of change in economic policy, but the absence of new bad news is good for the markets," Warne said of Turkey.

In U.S. markets, the Dow Jones Industrial Average rose 401.82 points, or 1.6 percent, to 25,564.23, the S&P 500 gained 28.4 points, or 1.01 percent, to 2,846.77 and the Nasdaq Composite added 66.32 points, or 0.85 percent, to 7,840.43.

The pan-European FTSEurofirst 300 index rose 0.44 percent.

Hopes that China and the United States could ease trade tensions helped Chinese stocks pare losses. The Shanghai Composite Index closed down 0.6 percent, while Hong Kong's Hang Seng index ended 0.8 percent lower.

Japan's Nikkei average closed 0.1 percent lower in choppy trade.

Oil also recovered somewhat after Wednesday's slide, though a weakening outlook for crude demand kept prices in check. U.S. crude rose 0.54 percent to $65.36 per barrel and Brent was last at $71.20, up 0.62 percent on the day.

U.S. Treasury yields were steady after edging higher overnight on the news of U.S.-China trade talks. Benchmark 10-year notes last fell 9/32 in price to yield 2.8822 percent, from 2.851 percent late on Wednesday.

(Reporting by April Joyner; additional reporting by Sinéad Carew in New York and Marc Jones in London; Editing by David Stamp and Dan Grebler)

This story has not been edited by Firstpost staff and is generated by auto-feed.

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Updated Date: Aug 17, 2018 01:05:12 IST

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