European shares continued their retreat this morning as concerns over China’s currency devaluation weighed on global stock markets and hit European exporters. The ESTX 50 (-2.42%), CAC 40 (-2.53%), Dax (-2.31%) and the UK markets (-1.41%) all posted losses in early trading. Rio Tinto Group, BHP Billiton Ltd, Antofagasta Plc and Glencore Plc all fell more than -2.8%. A gauge tracking UK miners looks like heading for its lowest close since 2009. Burberry Group Plc lost -3.1% as the devaluing yuan is expected to hurt earnings. Unilever Plc also declined -3.1% after Goldman Sachs Group Inc recommended selling the stock. Balfour Beatty Plc slid -1.5% after reporting a loss for the first half of the year. Henkel AG dropped -6.7% after reporting second quarter earnings that fell short of analyst estimates. Pearson Plc fell -0.9% after agreeing to sell its stake in the Economist magazine in a £469 million deal with Exor Spa.
US stocks declined as China’s devaluation of its currency hit companies with a big exposure to China and added to worries about the global economic outlook. The Dow Jones Industrial Average (-1.21%), S&P 500 (-0.96%) and the Nasdaq composite (-1.27%) all declined. Apple Inc dropped -5.2% for its biggest daily percentage decline since January 2014, making the stock the biggest drag on all three major US indexes. Jefferies also raised concerns about the demand for the iPhone, primarily in China. Among other companies with big exposure to China, Caterpillar was down -2.6% and Yum Brands dropped -4.9%. General Motors shares lost -3.5%, though it said the devaluation of the yuan would have a limited and manageable impact on its business.
Asian stocks fell after China cut the value of the yuan for a second day, sending equity indexes across the region lower. The Nikkei 225 (-1.58%), Hang Seng (-2.48%) and the S&P/ASX 200 (-1.67%) all decreased. The move by China has sparked fears of a global currency war and accusations that Beijing was giving an unfair advantage to its struggling exporters. China Eastern and China Southern both slumped nearly -6%, while rival Air China lost -4.4%. But some Chinese exporters gained as investors hunted for companies that benefit the most from a weaker yuan. Luthai Textile Co, Shanghai Metersbonwe Fashion and Accessories Co and Hunan Mendale Hometextile Co all surged by their 10% daily limit.
Morning Spread 8th March 2017 European shares traded flat this morning, the modest moves masking significant results driven games by several companies on a bust day for European earnings.
Morning Spread 2nd November 2016 Asian stocks followed global equities lower despite gauges of manufacturing in China topping estimates and the Bank of Japan maintained its record stimulus program.
Morning Spread 1st November 2016 Asian stocks were mixed as declines in oil prices dragged energy shares lower and investor anxiety grew over next week’s US presidential election.
Morning Spread 28th October 2016 Asian stocks fell as oil explorers pushed down Hong Kong gauges, while investors digested earnings from several companies.
Morning Spread 27th October 2016 US stocks were mixed following the release of earnings from several companies.
Morning Spread 24th October 2016 US stocks were little changed as a record day for Microsoft and earnings from McDonald’s helped offset a fall in energy and healthcare shares.
Morning Spread 19th October 2016 Asian shares rose as a barrage of Chinese data confirmed the economy had stabilised on the back of government spending and a hot housing market, even if worries about debt continue to mount.
Morning Spread 10th October 2016 Asian stocks were mixed following the second US presidential debate between Hilary Clinton and Donald Trump.
Morning Spread 5th October 2016 Most Asian stocks outside Japan slid on concern central banks will reduce stimulus, while the Nikkei climbed after the yen weakened.
Morning Spread 27th September 2016 Asian stocks advanced with investors viewing Democratic candidate Hillary Clinton as having gotten the upper hand in the first US presidential debate.