European and US markets pushed higher on Thursday despite the US-China trade war rumbling on (Daniel ROLAND)

London (AFP) – European and US stock markets recovered slightly on Thursday, despite Beijing ratcheting up its rhetoric against Washington as the US-China trade war rattles on.

The dollar rose against the euro, with the European single currency continuing to take a knock from increasing concerns over Italy’s debt mountain.

“Today has seen US and European markets take a welcome reprieve from the incessant selling that has dominated much of this week,” said IG market analyst Josh Mahony.

US stocks dropped on Wednesday to their lowest level in ten weeks on a heady mixture of trade war worries and growing concerns over the state of the US economy.

But David Madden at CMC Markets UK said “the move feels hollow as political and economic relations are still strained” between the United States and China.

Meanwhile, Wall Street pushed higher as the downward revision of US GDP growth in the first quarter from 3.2 to 3.1 percent was better than expected.

Briefing.com analyst Patrick O’Hare said that nothing had improved on the US-China trade deal front to foster a positive bias.

“The improved tone, then, is being driven predominately by a sense that the stock market seems primed to bounce from a short-term oversold condition,” he said.

Global stock markets had largely slumped on Wednesday on the latest salvos in the US-China trade war.

With no date set for talks to resume, and Beijing accusing Washington of “naked economic terrorism” on Thursday in its handling of the dispute, investors appeared resigned to the prospect of the dispute extending into the coming months.

“We are against the trade war, but we are not afraid of it,” Chinese vice foreign minister Zhang Hanhui told a press briefing.

“This premeditated instigation of a trade conflict is naked economic terrorism, economic chauvinism, and economic bullying,” Zhang added.

A veiled threat by Beijing on Wednesday to cut critical exports of rare earth minerals to the United States intensified concerns.

It was the latest salvo in a months-long row that has seen Washington and Beijing slap tit-for-tat tariffs on imports, with US President Donald Trump upping the ante in recent weeks by blacklisting Chinese telecom giant Huawei.

Any move by China, which produces 95 percent of the world’s rare earths, to restrict exports to the US would have a devastating impact on manufacturers of everything from smartphones to computers to lightbulbs.

In Asian stocks trading Thursday, Tokyo and Shanghai ended 0.3 percent lower while Hong Kong dropped 0.4 percent. 

In bond markets, a push towards haven purchases has seen the yield, or rate of return, on 10-year US Treasury notes plummet to the lowest level since September 2017.

Investors were also worried about short-term yields rising above those for 10-year debt, which is seen as a sign of an impending recession.

– Key figures around 1530 GMT –

London – FTSE 100: UP 0.5 percent at 7,218.16 points (close)

Frankfurt – DAX 30: UP 0.5 percent at 11,902.08 (close)

Paris – CAC 40: UP 0.5 percent at 5,248.91 (close)

EURO STOXX 50: UP 0.6 percent at 3,317.17 

New York – Dow: UP 0.08 percent at 25,147.65 

Tokyo – Nikkei 225: DOWN 0.3 percent at 20,942.53 (close)

Hong Kong – Hang Seng: DOWN 0.4 percent at 27,114.88 (close)

Shanghai – Composite: DOWN 0.3 percent at 2,905.81 (close)

Euro/dollar: DOWN at $1.1136 from $1.1141 at 2100 GMT 

Pound/dollar: DOWN at $1.2607 from $1.2628 

Dollar/yen: UP at 109.72 yen from 109.62 yen 

Oil – Brent Crude: DOWN $1.42 at $68.03 per barrel

Oil – West Texas Intermediate: DOWN 67 cents at $58.14 per barrel

burs-rl/cw

Disclaimer: Validity of the above story is for 7 Days from original date of publishing. Source: AFP.