Global Stocks Hit 5 Month High, Ignore Reports Of Trump-Xi Meeting Delay, 737 MAX Subpoena
Global stocks rose to the highest level in five months and the dollar dipped on Monday as traders ignored a SCMP report that the April meeting between presidents Xi and Trump had been delayed to June, and glossed over the latest slide in Boeing stock following a WSJ report of a grand jury subpoena into the 737 MAX's development, as they once again priced in the dovish stance from the Fed at its policy meeting this week, a process which has been going on since December.
MSCI’s World index was up 0.3% on the day, sitting at a five-month high, hitting its highest since October 10.
European markets were broadly in the green, led by miners and banks, helped by a jump in shares in German lenders Deutsche Bank and Commerzbank after they confirmed over the weekend they were in talks to merge, a process which is far from certain will end with a merger despite the German government's backing. The STOXX Europe 600 index rose 0.3%, hitting a five-month high, before trimming gains in half.
Britain’s FTSE 100 outperformed its European peers with a 0.3 percent gain, the main beneficiary from the surge in base metal prices with heavyweight miners all sitting comfortably at the top of the index (Rio Tinto +2.2%, Anglo American +2.1%, Antofagasta +1.8%, Glencore +1.7%); gains were boosted by prospects of parliament voting for a third time on Prime Minister Theresa May’s Brexit plan after ruling out a near-term no-deal exit.
European material names initially outperformed but were later overtaken by financial names ahead of a plethora of central bank rate decision including FOMC and BOE. Financial names may also feel support from the Deutschebank (+3.9%)/Commerzbank (+6.6%) saga, with the latest reports confirming merger talks between the two banks after the German government approved the tie-up, although, German union Verdi warned that merger could put up to 30k jobs at risk, to which the government replied that jobs at stake are being examined.
Earlier in the session, Asian stocks began the week mostly higher after last Friday’s tech-led upside on Wall St, but with early cautiousness amid reports the Trump-Xi summit was said to be pushed back to June. In related news, a source reportedly suggested that there was a divergence within the Trump administration regarding the deal with China. ASX 200 (+0.3%) eked marginal gains as underperformance in telecoms and financials offset some of the commodity-driven strength in the Australian bourse, while the Nikkei 225 (+0.6%) was underpinned by a weaker currency following weaker than expected data in which Trade Surplus topped estimates but both Exports and Imports contracted more than expected. Elsewhere, Hang Seng (+1.4%) and Shanghai Comp. (+2.5%) were both positive after the PBoC increased its liquidity efforts and as mainland China shrugged off an early whimsical tone caused by uncertainty from the delay of the Trump-Xi summit.
U.S. equity indexes were flat, with the Dow in the red, dragged lower by the latest drop in Boeing stock which tumbled following a WSJ report that the US Transportation Department are reportedly probing FAA approval of the 737 Max.
https://www.zerohedge.com/news/2019-03-18/global-stocks-hit-5-month-high-ignore-reports-trump-xi-meeting-delay-737-max
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