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Fragile sentiment as global market sell-off eases


There are signs the global stock market rout is over – for now – as values begin to climb again after a bruising week.

New York’s Dow Jones Industrial Average had closed more than 500 points, or 2%, down during Thursday’s session following a 3% fall the previous day.

There had earlier been a further dip for the FTSE 100 in Britain, which saw £36bn wiped off the value of its constituent companies – taking the total loss over two days to £60bn.

But Asia started Friday on a largely positive footing. The Nikkei in Japan was almost 0.5% higher by the close while the Hang Seng in Hong Kong was 1.7% up.

The main markets in Europe were up too, albeit with subdued sentiment, until near the close.

The FTSE 100 shut 11 points down on Friday to cap a miserable week for values.

The Dow rose 1.5% at the open but later lost some of those gains. Tech stocks – worst hit this week – were the best performers.

Market experts said a cocktail of worries for stock market investors remained firmly in focus.

:: The global stock market sell-off explained

Chief among them is the rising path of US interest rates, which it is feared could put the brakes on the world’s biggest economy by adding to borrowing costs for consumers and businesses.

Adding to the anxiety is the uncertainty caused by Mr Trump’s trade war with China as well as the sharp upturn in yields on bonds – parcels of US government debt – which is diverting some investor attention from stocks.

The ongoing market turmoil prompted Mr Trump to lash out at the US Federal Reserve – accusing the central bank of being “out of control” after a series of interest rate hikes.

But the Fed – led by Mr Trump’s hand-picked chairman Jerome Powell – won backing from International Monetary Fund chief Christine Lagarde, who said that raising rates in economies like America’s was “clearly a necessary development”.

Mr Trump conceded to White House reporters that he was “not going to fire” Mr Powell.

(c) Sky News 2018: Fragile sentiment as global market sell-off eases