Share markets were poised to head into the weekend with gains
London (United Kingdom) (AFP) - World stock markets mostly rose Friday as US President Donald Trump soothed concerns about military action in Syria.
Sentiment is Asia was boosted also by hopes the US could rejoin a massive Pacific-wide free-trade pact.
London’s benchmark FTSE 100 index struggled to keep up with its rivals owing to a strong pound weighing on the share prices of multinationals earning large amounts in other currencies.
“With the pound hitting a two-month high against the dollar and ten-month high against the euro, it comes as no surprise that the internationally focused FTSE 100 suffers,” noted Joshua Mahony, market analyst at IG trading group.
Spreadex analyst Connor Campbell said that “the pound has been able to take advantage of both the dollar’s ongoing uncertainty, and the euro’s weakened state post-dovish ECB meeting minutes”.
Governors of the European Central Bank have cast doubt on any risk of overheating in the eurozone economy, according to minutes of their last meeting published on Thursday.
In the US this week, Trump on Wednesday sent shudders across trading floors when he warned “missiles will be coming” to Syria in response to an alleged chemical attack by the Russia-backed regime, fuelling fears of a stand-off between the major powers.
But he tempered the rhetoric a day later suggesting he might hold off on an imminent strike while he holds talks with France and Britain on how to deal with the crisis.
As investors digested the remarks, it emerged Trump had directed senior aides to explore rejoining the Trans-Pacific Partnership (TPP), which he left on becoming president, calling it a US jobs killer.
The U-turn came as he suggested the US and China might not eventually impose tariffs on each other’s goods, despite recent tit-for-tat warnings over hundreds of billions of dollars of trade.
That followed Chinese President Xi Jinping’s conciliatory speech this week promising to open up his country’s economy.
The developments provided lift for markets, which were sent into turmoil when Trump last Friday threatened fresh tariffs on a vast array of Chinese imports, fanning fears of a trade war between the world’s top two economic powers.
Trump also said Thursday the review of a trade pact with Canada and Mexico was “coming along great”.
- ‘Back from the brink’ -
“Remarkable. That’s the only thing I can really say in the past 36 hours or so about the change in tone that seems to be emanating from the president and the White House,” Greg McKenna, chief market strategist at AxiTrader, said Friday.
“President Trump is walking back from the brink on so many fronts it’s making my head spin,” he added.
“It’s becoming clear his tweets are part of an anchoring approach he uses in negotiations and then eases away from to achieve what he wants. It’s working on many fronts and he’s eased back on China and Russia/Syria this week and there was news last night he’s even reconsidering the TPP.”
All three main indices in New York ended sharply higher on Thursday.
On oil markets, the easing of fears about a possible US strike in Syria saw prices steady, having rallied in recent days to highs not seen since the end of 2014.
- Key figures around 1045 GMT -
London - FTSE 100: FLAT at 7,256.52
Frankfurt - DAX 30: UP 0.7 percent at 12,495.56
Paris - CAC 40: UP 0.4 percent at 5,328.99
EURO STOXX 50: UP 0.4 percent at 3,457.57
Tokyo - Nikkei 225: UP 0.6 percent at 21,778.74 (close)
Hong Kong - Hang Seng: DOWN 0.1 percent at 30,808.38 (close)
Shanghai - Composite: DOWN 0.7 percent at 3,159.05 (close)
New York - Dow: UP 1.2 percent at 24,483.05 (close)
Euro/dollar: UP at $1.2337 from $1.2329 at 2100 GMT
Dollar/yen: UP at 107.60 yen from 107.26
Pound/dollar: UP at $1.4292 from $1.4230
Oil - Brent North Sea: UP 24 cents at $72.26 per barrel
Oil - West Texas Intermediate: UP 29 cents at $67.36