NEW YORK: Rising shares of US technology companies and General Electric Co helped global stock markets regain ground on Tuesday, a day after a mounting trade fight pummeled equities, while oil surged as Washington pushed its allies to halt Iranian crude imports.
GE jumped 8.6 percent, putting it on track for its biggest one-day gain in more than three years, after the company said it would spin off its healthcare business and divest its stake in oil-services company Baker Hughes.
Tech stocks rebounded from a sharp selloff on Monday, after US government officials said plans were in the works to block firms with at least 25 percent Chinese ownership from buying US companies with “industrially significant technology.”
The Dow Jones Industrial Average rose 99.47 points, or 0.41 percent, to 24,352.27, the S&P 500 gained 11.72 points, or 0.43 percent, to 2,728.79 and the Nasdaq Composite added 43.66 points, or 0.58 percent, to 7,575.67.
A basket of European stocks also got a reprieve. The pan-European FTSEurofirst 300 index rose 0.09 percent and MSCI’s gauge of stocks across the globe gained 0.18 percent, after Asia had extended a sell-off that has wiped $1.5 trillion off world stocks.
Despite the modest gains, investors remained wary.
“We’re still in a tug-of-war between daily twists and turns of a potential trade war and the reality of a strong underlying US economy,” Brent Schutte, chief investment strategist at Northwestern Mutual Wealth Management Co, said.
Escalating trade tensions between the United States and China, as well as Washington and Europe, had led two benchmark Wall Street indexes on Monday to suffer their biggest losses in more than two months and launched China into bear market territory, with its major stock indexes down 20 percent from January peaks.
After seeing a surge in buying on Monday, US Treasury debt yields edged higher as concerned lingered that trade tensions could hurt economic growth, though safe-haven buying was capped on anticipation of more interest rate hikes from the Federal Reserve.
The tense atmosphere knocked down most industrial metal prices amid worries about the global fallout of the trade conflict between the US and China, which could hamper economic growth and metals demand.
Copper and aluminum were at or near their lowest since April while zinc plunged to its weakest since August last year.
Gold hit its lowest in over six months as the selloff in global risk assets eased and it remained under pressure from the prospect that rising US interest rates will further support the dollar.
Oil prices, meanwhile, soared after a US government official said Washington was pushing its allies to halt imports of Iranian crude.
“We’re going to isolate streams of Iranian funding and looking to highlight the totality of Iran’s malign behavior across the region,” the official told reporters.
Benchmark oil prices jumped over 2 percent and US crude topped $70 a barrel for the first time in two months
Brent crude gained $1.30 to trade at $76.03 by 2:17 p.m. EDT (1817 GMT). US light crude rose $2.08 to $70.16.
News that Saudi Arabia plans to pump up to 11 million barrels of oil in July, the most in its history, was outweighed by the renewed Iranian supply concerns, traders said.
In currencies, the dollar index rose 0.42 percent, with the euro down 0.47 percent to $1.1647.
The Japanese yen weakened 0.33 percent versus the greenback at 110.13 per dollar, while sterling was last trading at $1.3208, down 0.50 percent.
The Turkish lira firmed against the dollar in volatile trade amid uncertainty over economic policy under a new government due to be formed following President Tayyip Erdogan’s victory in Sunday’s election.
Source: Brecorder
