Dollar Gains as Treasury Yields Rise; Stocks Drift: Markets Wrap
The dollar strengthened and U.S. Treasury yields rose as President Donald Trump called on North Korea to “make a deal” on its missile and nuclear program. European stocks fluctuated near a two-year peak following record gains in Asian markets. The Stoxx Europe 600 Index steadied, erasing an early advance, after stocks from Japan to Sydney reached fresh milestones, with the Nikkei 225 gauge rising to a level last seen in 1992. Disappointing reports from BMW AG and Associated British Foods Plc weighed on the European index as third-quarter earnings season continued. The euro declined to a four-month low and bund yields nudged higher after German industrial production fell more than expected in September. Meanwhile, WTI crude hovered near the highest since January and stock indexes across the Gulf were among the world’s worst performers, with Saudi Arabia’s Tadawul All Share Index falling the most in a year as the biggest oil exporter widened a crackdown on corruption.
Europe:
U.K. House Prices Rise Even as Confidence Drops to Five-Year Low
U.K. house-price growth accelerated in the last three months, reflecting the continued imbalance of supply and demand in the property market. Prices between between August and October were 2.3 percent higher than in the previous three months, the lender said on Tuesday — the fastest growth since January. On an annual basis, prices increased 4.5 percent, the most since February. Despite the pickup, confidence in housing is falling. According to Halifax, sentiment is now at its lowest in almost five years. Supply is also declining, with the number of new sellers falling for the 19th consecutive month in September. The property market has been cooling in recent years, with London the worst hit after years of outperformance, particularly in prime districts of the city. According to Nationwide Building Society, annual home-price inflation is running about 2.5 percent. The Halifax report comes less than a week after the Bank of England raised interest rates for the first time in a decade in an attempt to curb inflation. While a fifth of mortgage holders never experienced a rate hike before, the BOE expects the impact of the tightening will be gradual overall because so many borrowers are tied to fixed rates.
Asia:
China Has a Plan That Could Hand Trump a Win on the Deficit
When Donald Trump lands in Beijing this week intent on tackling one of his biggest irritations — the trade deficit — he could get help from an unlikely source: his hosts. In response to questions from Bloomberg News, China’s Commerce Minister Zhong Shan laid out a list of measures being undertaken that could help narrow the $327 billion gap, America’s largest with any nation. China will host its first-ever import fair in November next year, and will roll out tax, fiscal and administrative initiatives aimed at helping foreign firms sell more into what is becoming a big and sophisticated consumer market, Zhong wrote. Slated for Shanghai in November 2018, the China International Import Expo (CIIE) reflects China’s “sincere wish to open its market to the world and its sense of responsibility as a big country to push for an open world economy,” he said.
