FILE PHOTO: Visited on 29 December 2017 in London Stock Exchange Group’s office, City of London, UK. REUTERS / TOBE MELVILLE
The broader Euro STOXX 600 rose 0.6% with London’s FTSE .FTSE 1% and European and Gas shares. 2% climb on rising oil prices .XX.
Shares in BP (BP.L) And Royal Dutch Shell ()RDSa.L) After Saudi Aramco rose 3.4% and 2.7% respectively (2222.SE) Increased optimism about Asian demand growth and Iraq pledged to cut supplies further. [O/R]
The decline in China’s factories was mitigated in July, with global energy prices rising and industrial activity moving toward pre-coronavirus levels.
Industrial production in the world’s second-largest economy is returning to a sustained level before the economy has seen a massive decline, driven by increased demand, government stimulus and surprisingly resilient exports.
Market players said that this is very good for global recovery from coronovirus epidemic.
“China is already so far ahead in this process of lockdown and locking out, that any good sign is necessary (for the world economy) for the Chinese economy,” said Florian Ilapo, head of macroeconomic research at Unigestion.
The MSCI World Equity Index .MIWD00000PUS, which tracks shares in 49 countries, gained 0.1%. Wall Street futures ESC1 points to a positive start.
But the progress was investigated due to tensions between the United States and China. Uncertainty about the deal on the US stimulus package also affected the markets
US President Donald Trump signed executive orders banning the Chinese social media platform WeChat – owned by Chinese tech giant Tencent (Korean).0700.HK) – and TeakTalk is starting next month, and restrictions have been imposed on 11 Hong Kong and Chinese officials.
US regulators also recommended that foreign companies listed on US exchanges be subject to US public audit reviews by 2022.
US-China tensions have stoked fears about adverse effects on trade negotiations. Investors said any friction here could complicate global recovery from the coronavirus epidemic.
Underscoring concerns, European technical stocks. SX8P suffered a 0.8% loss on tensions between Washington and Beijing, the only region to fall in early trade.
Earlier, Asian stocks outside of Japan .MIAPJ0000PUS had seen holiday-thin trading, reaching a six-month peak last week. They were the last 0.1%.
Waiting for washington
Further uncertainty for investors is underway in Washington on the US fiscal stimulus package that has hollowed out the US dollar.
On Sunday, House Speaker Nancy Pelosi and Treasury Secretary Steven Menuchin said they were open to resuming aid talks.
Trump has sought to take matters into his own hands to sign executive orders and memoranda aimed at unemployment benefits, evictions, student loans and payroll taxes.
The two-year dominance of the dollar has slipped, with investors worried that the US recovery may lag behind in other major economies.
Against a basket of currencies, the dollar was slightly stronger at 93.339 = USD and is still above the trough of two years.
Analysts at MUFG in London wrote, “The latest stimulus given by President Trump through executive orders is better than none and provides a solution to the stop gap.”
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Reporting by Tom Wilson, editing by Larry King