It was a slow, if positive, start for the likes of the FTSE and the DAX, as investors warily eye the rising US-China tensions without going into panic mode.
The UK index added 0.4% as trading got underway, putting some distance between it and the 6200 mark it was threatening to fall under. This as sterling remained suppressed, slipping another 0.2% against dollar and euro alike on a lack of Brexit progress.
The DAX was the strongest of the major European indices, climbing half a percent as it eked out another 5-month high, while the CAC lagged behind with a 0.2% increase.
To be fair to the markets, they would’ve been forgiven if they had opened in the red. US-China tensions are heating up once again following the former’s shutdown of the latter’s consulate in Houston on accusations of spying. A fire at the grounds of the consulate prompted Trump to claim ‘they were burning documents and burning papers’, while Beijing has labelled the move an ‘unprecedented escalation’.
It’s right out of the Trump playbook, a return to China-bashing as an election tactic to distract from his disastrous handling of domestic matters. The concern for investors is whether a) Beijing retaliates, and b) the President ups the ante as the November draws nearer.
For now, however, the markets have taken the news relatively in their stride. The Dow Jones, for example, is aiming for a 60 points increase after the bell, one that would keep it the right side of 27000.
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