Global Shares Slide on Heels of Drop in Dow and Spain Attacks -- 3rd Update
August 18 2017 - 7:03AM
Dow Jones News
By Justin Yang
-- Global stocks down following Spain attacks
-- Haven assets advance
-- Wall Street poised for flat open
Global stock markets were lower Friday, amid political tensions
in the U.S. and as some European stocks suffered following terror
attacks in Spain.
European markets were broadly lower after an assault in
Barcelona and a subsequent attack in the Spanish coastal town of
Cambrils left at least 14 people dead. The Stoxx Europe 600 slid
0.8% Friday morning. Spain's benchmark IBEX 35 was one of Europe's
biggest decliners, down 1%.
Futures indicated the S&P 500 was poised to open flat.
Shares of European travel companies suffered some of the largest
losses of the day. International Consolidated Airlines Group
SA--one of the biggest decliners in the U. K.--fell 2%. Airline
shares in Europe tend to endure a short-lived selloff in the wake
of terror attacks as investors assess the potential for a hit to
tourism.
The Stoxx Europe 600 Travel and Leisure sector was the worst
performing sector, down 1.2% Friday.
Simmering geopolitical tensions and the Trump administration's
strained relationship with business leaders saw investors shift to
haven assets, boosting gold by 0.7%. The U.S. 10-year Treasury
yield was nearly flat at 2.196% Friday from 2.197% Thursday,
according to data from Tradeweb. Yields move inversely to
prices.
The WSJ Dollar Index, which tracks the dollar against a basket
of currencies, was down 0.3%.
On Thursday, the Dow Jones Industrial Average suffered its
biggest decline in three months.
"The markets are having a wobble because they don't like the
tweets and the dismissal of business councils," said John Redwood,
chief global strategist at Charles Stanley.
U.S. corporate earnings led premarket activity. Retailer Ross
Stores Inc. was one of the biggest gainers, up 10.3% after beating
sales expectations in its earnings. Shoe retailer Foot Locker Inc.
fell 4% after it released its earnings.
Retailers in the U.S. have been releasing mixed results on
earnings throughout the week.
Agricultural company Deere and Co. shares in premarket trade
were flat after it released its earnings Friday.
In Asia, markets were lower Friday with financial shares among
the region's biggest decliners.
The Nikkei Stock Average was down 1.2%. There was added pressure
from the advance of the yen against the dollar, last up 0.4%.
Hong Kong's Hang Seng Index was down 1.1%, while Australia's
S&P/ASX 200 narrowed its loss to 0.6%. Korea's Kospi was off
0.1%. In China, the Shanghai Composite Index was flat.
Friday's declines reflect investors' increasingly downbeat
attitude about stocks, said Soichiro Monji, general manager of
economic research at Daiwa SB Investments. Investors fear returns
are falling due to slower growth, he said, while risks remain
abundant.
Further woes in the Trump administration after the president's
policy advisory council of executives disbanded risk hurting market
confidence and business sentiment globally.
"Everyone's keeping an eye on that to make sure it doesn't
derail on his agenda. We're already deadlocked on a number of
issues. If that turns further south it could be damaging with the
market," said Mark Spellman, a portfolio manager at Alpine
Funds.
Developments on the looming debt ceiling debate and tax reform
in the U.S. are also being watched closely by investors, Mr.
Spellman said.
Ese Erheriene, Kosaku Narioka and Kenan Machado contributed to
this article.
(END) Dow Jones Newswires
August 18, 2017 07:48 ET (11:48 GMT)
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