Markets Mixed Ahead Of Barrage Of News As Gold Hits 6 Month High
In a session that has seen global markets drift around ahead of a barrage of key events and gold climb to a seven-month high, European stocks reversed modest early losses to trade 0.8% higher, with UK’s FTSE 100 rising 1.4% as cable fluctuated ahead of today's "Plan B" Brexit vote, with S&P futures erasing early losses in Asia to trade flat, some 12 points off sessions low as markets opted for caution before three major macro events and a blizzard of big tech company earnings in the coming days.
Despite the upcoming action - a key Brexit vote in the UK , Wednesday’s Fed decision, Thursday’s conclusion of the latest Sino-U.S. trade talks and Friday's payrolls - European and Asian stocks held up relatively well, however news that the U.S had leveled charges against China’s telecom giant Huawei days before the next round of trade talks between Washington and Beijing knocked sentiment. That, however, was offset by promises of more economic stimulus from China, which had berated Washington on Monday for blocking the appointment of judges for its World Trade Organisation appeal against U.S. tariffs.
As SocGen's Kit Juckes writes overnight, traders are puzzled by various market inconsistencies, with more questions about what's NOT happening in markets than about what is going on, such as: "Why didn't Mario Draghi's admission of downside economic surprises weaken the euro? And why didn't the end of the US government shutdown give Treasury yields a nudge higher?"
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