BEIJING – Global stock markets traded in fairly narrow ranges Monday as investors awaited developments on the U.S.-China trade talks front and a raft of economic data this week that culminates with monthly U.S. jobs figures.
In Europe, Germany’s DAX was down 0.2% at 13,205 while the CAC 40 in France fell 0.4% to 5,880. The FTSE 100 index of leading British shares was 0.1% lower at 7,339. Wall Street was poised for a modestly higher opening with Dow futures and the broader S&P 500 futures up 0.1%.
Whether markets enjoy a so-called Santa Rally this year will depend largely on how the U.S.-China trade talks pan out over the coming weeks. Investors have grown cautious about lack of results from U.S.-Chinese talks on terms of the “Phase 1” deal announced by President Donald Trump in October. Washington is due to raise tariffs on $160 billion worth of Chinese products, including smartphones and laptops, as of Dec. 15.
Trump has expressed concern negotiations might be affected by legislation he signed last week that is intended to buttress Hong Kong’s status as a semi-autonomous Chinese territory amid tension over anti-government protests. The measure could alter treatment of Hong Kong as a separate territory for trade if the State Department determines it no longer has enough autonomy from the Chinese mainland.
“The demand for constant updates on the trade talks doesn't appear to be subsiding, although that may change as attention shifts elsewhere throughout the week,” said Craig Erlam, chief market analyst at OANDA.
There’s a lot of economic news this week, including Friday’s monthly U.S. nonfarm payrolls data that have the potential to give markets a steer as they assess what the Federal Reserve is going to do with interest rates over the coming months.
The data run began earlier in Asia, with upbeat Chinese data that helped to buoy sentiment. Caixin magazine said its purchasing managers’ index rose to a two-year high of 51.8 from October’s 51.7 on a 100-point scale on which numbers above 50 show activity expanding. A separate survey by the China Federation for Logistics & Purchasing rose to 50.2 from 49.3.
In Asia, Shanghai Composite Index closed up less than 1 point at 2,872.61 and Tokyo’s Nikkei 225 added 1% to 23,529.50. Hong Kong’s Hang Seng gained 0.4% to 26,444.72. Seoul’s Kospi advanced 0.2% to 2,091.92 and Sydney’s S&P-ASX 200 was 0.2% higher at 6,862.30.
ENERGY: Benchmark U.S. crude rose $1.18 to $56.35 per barrel in electronic trading on the New York Mercantile Exchange while Brent crude, used to price international oils, rose $1.25 to $61.74 per barrel in London.
CURRENCIES: The euro was flat at $1.10 while the dollar was steady at 109.54 yen