Global stocks decline amid geopolitical tensions

  • The euro was 0.4 per cent weaker against the dollar at $1.0619. The greenback was up 0.1 per cent versus the yen at 109.16. Sterling was down 0.3 per cent against the dollar at $1.2505. The dollar index, a measure of the greenback against a basket of peers, was down 0.2 per cent at 100.57.
  • Brazil’s real weakened 0.6 per cent to 3.1453 per dollar after the Supreme Court authorised investigations into alleged corruption by dozens of Brazil’s most senior politicians, including 8 ministers in the government of pro-reform President Michel Temer. On Wednesday, Brazil’s central bank cut the benchmark Selic rate by 100 basis points to 11.25 per cent, following two 75 basis-point cuts. The central bank is expected to cut the Selic rate to 8.5 per cent by the end of this year and hold it at that level until the end of 2018 as the worst recession on record has helped to reduce annual inflation to 4.57 per cent in March, from 9.39 per cent in March 2016.
  • US rigs drilling for oil rose by 11 to 683 this week, according to oilfield services company Baker Hughes. That is the highest level in almost two years. Brent, the international crude benchmark, was down 0.2 per cent at 55.74 dollars a barrel. West Texas Intermediate, the US oil marker, was 0.1 per cent lower at 53.04 dollars a barrel.
  • The yield on the 10-year US Treasury note was essentially flat at 2.23 per cent, the lowest level since the aftermath of the US presidential election last November. The 10-year German Bund yield fell 1 basis point to 0.19 per cent, while the yield on the equivalent-duration France’s government bond added 1 basis point to 0.93 per cent. Yields fall as bond prices climb.
  • In Asia, Australia’s S&P/ASX 200 fell 0.7 per cent. Hong Kong’s Hang Seng slipped 0.2 per cent. On the Chinese mainland, the Shanghai Composite added 0.1 per cent. The Topix index in Tokyo lost 0.8 per cent.
  • In Europe, the pan-regional Stoxx 600 index shed 0.4 per cent. The UK’s FTSE 100 closed down 0.3 per cent. Germany’s DAX lost 0.4 per cent. France’s CAC 40 was down 0.6 per cent.
  • In New York, the S&P 500 equity index fell 0.7 per cent, with all 11 of the index’s sectors finished lower. The Dow Jones Industrial Average declined 0.7 per cent. The tech-heavy Nasdaq Composite ended down 0.5 per cent.

WPJ

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