Stock markets in Asia and Europe slumped yesterday after data pointed to weakness in the Chinese and eurozone economies, despite further indications Beijing and Washington may be moving to end their trade row. Signs of easing tensions had helped propel equities higher earlier this week, with both China and the United States seeming to give key concessions, fuelling hopes they can eventually resolve their differences. But data showing that the trade war is already having an impact on China — consumer spending grew at its slowest pace in 15 years and factories eased up in November — prompted equities investors there to take their gains off the table.
Hong Kong fell 1.6 per cent and Shanghai closed down 1.5pc. Meanwhile, Tokyo finished two percent lower following a survey of confidence among Japan’s big businesses showed they remain cautious about the global outlook. Then in Europe a survey showed that Global trade war fears and disruptions caused by anti-government protests in France pushed business growth in the eurozone to a four-year low in December.
The slide in IHS Markit’s composite eurozone PMI, to 51.3 points from 52.7 points in November, came just a day after the European Central Bank pulled its extraordinary support that has stoked growth in the single currency area for the past three years. The survey for France showed business there had flipped into reverse, as the index plunged to 49.3 in December from 54.2 in November.
The euro briefly slid back under $1.13, a day after the European Central Bank said it was ending its programme of asset purchases which had propped up eurozone growth for the past three years, despite ECB boss Mario Draghi’s assessment that there were increasing risks to the economy of the single currency bloc. The pound moved lower as European leaders refused pleas for help from Prime Minister Theresa May to push their Brexit deal through a fractured British parliament.
This article provided by NewsEdge.