Tech shares boost Wall Street amid lingering trade war fears

A trader works on the floor of the New York Stock Exchange (NYSE) in Manhattan, New York City, US. (Reuters pic)

NEW YORK: World stock markets were mixed Monday amid lingering trade war fears, although US equities pushed higher led by resurgent technology shares.

Key eurozone markets Frankfurt and Paris reversed early small gains to close flat to lower, while the British pound’s weakness kept London stocks in slightly positive territory.

Major Wall Street stock indices finished solidly higher, led by the tech-rich Nasdaq, which continued to rally following last week’s robust earnings from Apple and some other companies.

Analysts cited the strong second-quarter earnings season as a supporting factor to stocks, with S&P 500 companies so far reporting 24% higher profits compared with the year-ago period.

Earnings season “has been very good and continues to be good,” said Bill Lynch, director of investment at Hinsdale Associates. “It’s hard to argue with these numbers.”

But analysts said US stocks are helped by a wave of share buybacks as well.

An equities rally in Asia petered out earlier in the day on concerns about the brewing China-US trade war, while the yuan struggled to maintain momentum after the Chinese central bank moved to support the currency.

“European bourses are struggling to keep their heads above water … as trade war fears eroded gains in Asian markets,” said Fiona Cincotta, senior analyst at City Index.

“The trade dispute is showing no signs of abating on either side with China saying on Friday it plans to bring in tariffs on US$60 billion worth of US goods.”

Oil prices advanced on reports that Saudi Arabia lowered its oil output and as US sanctions were set to be reimposed on Iran following President Donald Trump’s decision to exit the Iran nuclear deal.

In forex trading, the pound dipped after International Trade Secretary Liam Fox declared over the weekend that the chances of a no-deal Brexit were now “60-40,” laying the blame on EU chief negotiator Michel Barnier.

Sterling was also fighting to recover from Friday’s sell-off after Bank of England boss Mark Carney warned that the chance of leaving the EU without a deal was “uncomfortably high” and “highly undesirable.”

In emerging markets, the Turkish lira hit fresh lows against the dollar and euro as strains caused by a diplomatic spat with the United States compounded concerns over domestic economic policy.

Key figures around 2100 GMT 
New York – Dow Jones: UP 0.2% at 25,502.18 (close)

New York – S&P 500: UP 0.4% at 2,850.40 (close)

New York – Nasdaq: UP 0.6% at 7,859.68 (close)

London – FTSE 100: UP 0.1% at 7,663.78 (close)

Frankfurt – DAX 30: DOWN 0.1% at 12,598.21 (close)

Paris – CAC 40: FLAT at 5,477.18 (close)

EURO STOXX 50: DOWN 0.1% at 3,479.63 (close)

Tokyo – Nikkei 225: DOWN 0.1% at 22,507.32 (close)

Hong Kong – Hang Seng: UP 0.5% at 27,819.56 (close)

Shanghai – Composite: DOWN 1.3% at 2,705.16 (close)

Euro/dollar: DOWN at US$1.1553 from US$1.1568 at 2100 GMT

Pound/dollar: DOWN at US$1.2943 from US$1.3001

Dollar/yen: UP at 111.39 yen from 111.25 yen

Oil – Brent Crude: UP 54 cents at US$73.75 per barrel

Oil – West Texas Intermediate: UP 52 cents at US$69.01 per barrel