Shares sink as U.S. Blacklist Saps Trade Optimism: Markets Wrap

(Bloomberg) – Stocks sank in US and Europe as a report The White House goes against restrictions on investment in China underpins investor optimism over ongoing trade talks. Government bonds declined.

Semiconductor stocks fell the most in six weeks, pulling down the S&P 500 index after China said it opposed a US decision to blacklist some of its technology companies, and Bloomberg reported that the Trump administration is continuing discussions on restricting capital flows . Chinese companies trading in New York fell to their lowest since mid-August. Ten-year government interest rates fell to 1.5%.

The Stoxx Europe 600 Index falls after two days gain. The pound weakened after Boris Johnson told German Chancellor Angela Merkel a Brexit deal is essentially impossible if the EU requires Northern Ireland to remain in the bloc's customs union.

The sudden escalation of tension between the United States and China comes just days before senior officials will resume their efforts to resolve a protectionist dispute that has fueled trade and markets for more than a year. People's Bank of China Governor Yi Gang will join Chinese Deputy Prime Minister Liu He during talks in Washington.

"China is still the overhang that will be the most important," said JJ Kinahan, chief marketing strategist at TD Ameritrade, in an interview at Bloomberg's New York headquarters. "Even though we have the conversations this week, it seems hard to believe that they will come out on Friday afternoon and be like, & # 39; OK, we've done it! It's over! & # 39; & # 39;

Asian stock standards had jumped from Tokyo and Seoul to Shanghai and Hong Kong, where trade showed little concern about ongoing turmoil, with the technically heavy South Korean index following regional progress after Samsung Electronics Co.'s earnings beat analysts' estimates.

Elsewhere, the dollar rose and pulled data showing a target of underlying US producer prices, which caused the largest monthly fall in more than four years. Turkey's lira stabilized after tumbling Monday in the wake of US President Donald Trump's threat to " destroy "the country's economy if it acts in excess of a military operation targeting Kurdish forces in Syria. Crude oil in West Texas dropped to around $ 52 a barrel.

Here are some key events that come up this e Week:

Fed Chairman Jerome Powell speaks Tuesday on the final day of NABE's Denver annual conference; the following day, minutes from the last policy meeting of the Fed's interest rate committee will be released. The report on the ECB's last meeting will be on Thursday. Chinese President Xi Jinping and Indian Prime Minister Narendra Modi are reportedly meeting at an unofficial summit. The United States will release a key target of inflation on Thursday.

Here are the key moves in the markets:


The S&P 500 index fell 1.2% from 11:26 a.m. in New York time. The Stoxx Europe 600 Index fell 1%. The MSCI Asia Pacific Index rose 0.4%. The MSCI Emerging Market Index was little changed.


The Bloomberg Dollar Spot Index rose 0.2%. Euro fell 0.2% to $ 1,095. The British pound fell 0.7% to $ 1.2205. The Japanese yen strengthened 0.2% to $ 107.09 per dollar.


The return on 10-year government bonds reduced four basis points to 1.52%. Germany's 10-year interest rate dipped two basis points to – 0.6%. Britain's 10-year return fell four basis points to 0.4%.


Gold increased 0.7% to $ 1,503.24 per gram. Western intermediate crude fell 1% to $ 52.23 a barrel.

– With assistance from Sybilla Gross, Andreea Papuc, Vassilis Karamanis, Samuel Potter and Todd White.

To contact the reporter about this story: Sarah Ponczek in New York at

To contact the editors responsible for this story: Jeremy Herron at, Brendan Walsh

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