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US sanctions against Huawei send stocks; Productivity falls behind Reuters




© Reuters. The trader works at the desk and the screens show market data at CMC Markets in London

European stocks dropped, yields on government bonds declined, while the Japanese yen strengthened on Thursday after the US government hit the Chinese giant of telecommunications Huawei with serious sanctions, which further exacerbates the Sino-US trade ties.

The index of European stocks dropped by 0.5% at the beginning of European trades with the German stock index by 0.4%. American stock futures fell by 0.4%, pointing to a weak start on Wall Street. investors expected government authorities to intensify market support and stabilize the mood.

"Chinese stocks are rising, as markets expect government intervention to maintain moods, but this type of activity is not sustainable, and if we do not see a clear resolution in China ̵

1; Trade Conflicts in the US, the overall mood will remain weak," said Neil Mallor , senior strategist FX at BNY Mellon in London.

Although the core indices in China and Hong Kong rose between 0.3-0.8% at the end of the bidding, bond markets signaled an even greater appetite for risk.

Return on principal bonds German government flirted with the lowest level for nearly three years, while the yield of Dutch bonds was set to fall on a negative territory phenomenon that was not observed since October 2016.

Later on Wednesday, the US Department of Commerce reported that it added Huawei Technologies Co Ltd and 70 affiliates to its Entity List "which prohibits companies to buy components and technology from American firms without approval by the government.

This move took the world markets unexpectedly, as the mood increased somewhat in the previous session on the theme that US President Donald Trump plans to defer import tariffs t cars after weakening US and China's weak economic data

CHANGE CULTIVARS OF DEVELOPMENT

As trade volumes again appeared on investor radars, weak US data also increased market expectations for lowering interest rates in the US in the upcoming months

retail sales fell unexpectedly in April when households reduced the volume of motor vehicle purchases and a number of other goods, while industrial production dropped by 0.5% in April, while in the third – in the third year

rates on 10-year US Treasury bonds dropped to 2.366%, about a 15-month low of 2.340%, which affected March 28th.

Federal Reserve interest rates are fully evaluated in the reduction of rates by the end of this year and more than 50% of the chances to go through to September.

"Markets are gradually stepping up pricing in a bid-down that is a sea change compared to last year, when consensus was reached on three to four times the raise yearly," said Akira Takay, asset manager of the One

Reduced US yield weakened dollar support by 0.1% against its basket of competitors

Oil prices rose in the prospect of tightening up in the Middle East, worsening world reserves, despite an unexpected increase in stocks.

increased by 0.3% to $ 71.99 per barrel. The semi-intermediate (WTI) oil brought $ 62.26, or half a per cent higher.

Gold reached $ 1296.9 per ounce.

For a blog Reuters Live Markets on the European and British stock markets, click on: [LIVE/]


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