LONDON: Global markets parted ways Wednesday as investors were more cautious about the chances of success in China-US trade talks, and looked for direction from the ECB.
The overall mood remained wary, with a rally that has characterized the start of the year stuttering due to slower Chinese economic activity, a softer global outlook, Brexit issues and the US government shutdown, which shows no sign of ending soon. “The markets appear to be trading a bit cautious ahead of tomorrow’s monetary policy decision from the European Central Bank (ECB) and as US/China trade worries are flaring up,” the Charles Schwab brokerage said.
US investors sold shares Tuesday after the Financial Times and CNBC said Washington had rejected Beijing’s offer of preparatory discussions ahead of the next round of high-level negotiations. Wednesday saw a sliver of respite as Wall Street opened just in the black, the Dow Jones adding 1 percent while the tech-heavy Nasdaq rose 0.6 percent. “We are continuing to see caution in the markets on Wednesday, with reports a day earlier regarding trade talks between the US and China only aiding that,” said Oanda analyst Craig Erlam.
“Reports that preparatory talks between the US and China ahead of a meeting at the end of the month had been canceled put a slight dampener on the mood … at a time when we’re already seeing some profit taking.” Although the White House denied the reports, observers said they highlighted how fragile the negotiations were. The reports also came a day after Bloomberg News said the two sides were struggling to reach agreement on the crucial matter of intellectual property, a key source of US anger. Hopes that China and the US were on the right track have helped rally global markets in January following a torrid performance in 2018.
But data showing China’s economy grew at its weakest pace in three decades added to fears it is heading for a hard landing, while Xi Jinping also showed signs of worrying about the effects of a slowdown in a speech to top provincial leaders this week. “Investors obviously are still a little bit edgy and therefore we would expect periods of volatility to continue,” said Mark Hackett, chief of investment research at Nationwide Funds Group. “As the headlines continue to get more nerve-wracking with regards to a global slowdown and trade wars and government shutdowns, it’s easy to spook investors, but we think those are temporary versus permanent.”
Adding to concerns was confirmation that the US plans to seek the extradition from Canada of a top executive with Chinese telecom giant Huawei before the end of January. Despite the pervading uncertainty, Frankfurt and Paris joined Wall Street in posting small gains in intraday trades, but London was down 0.5 percent with little immediate sign of Brexit-related gloom lifting. Hong Kong ended flat having swung back and forth through the day, while Shanghai closed 0.1 percent higher and Tokyo ended slightly down. Oil prices advanced after taking a hit Tuesday on lingering worries about the effect of a slowdown in the global economy, and particularly China, on demand.
India divertig attention from Spy’s case?
ISLAMABAD: Minister for Water Resources Faisal Vawda has termed the Indian threat to stop the flow of water from eastern rivers to Pakistan a “failed attempt”, just like the Pulwama incident, to divert attention from its failure in the Kulbhushan Jadhav case in International Court of Justice (ICJ).
In his reaction over India’s threat to stop Pakistan’s water, he said India could not blame Pakistan for its failure in the International Court of Justice to prove spy Kulbhushan innocent. As per Indus Water Treaty, India could not stop Pakistan’s water, he added, says a press statement here on Friday.
Describing the threat hilarious and void, he said the Indian government was preparing the ground to seek public support in next election by hurling allegation against Pakistan. “India must keep it in mind that it is a New Pakistan,” Vawda said adding that valiant Armed Forces of Pakistan would give a befitting response if India launched any misadventure. He said India would get nothing from its war hysteria except embarrassment among the comity of the nations.
Pilot drinking delays Japan plane
TOKYO: Japan’s All Nippon Airways said today it was forced to delay a domestic flight earlier this week after a co-pilot failed an alcohol breath test despite new rules.
The case came after Japan introduced fresh regulations to clamp down on alcohol consumption by pilots after several incidents involving flight crew drinking hit the headlines. On Tuesday, the ANA co-pilot was scheduled to fly a Boeing 777 with 322 passengers on board from Kobe in western Japan to Haneda airport in Tokyo.
But he failed a breath test and said he had consumed a can of beer and half a can of a spirit-based drink in his hotel room about six hours before the flight. The flight was delayed by more than an hour while a replacement pilot was found. The airline said in a statement it would deal with the case “rigorously”. It has banned pilots and co-pilots from drinking alcohol up to 24 hours before a flight.
Late last year, a Japan Airlines co-pilot arrested in Britain was jailed for 10 months after being found shortly before a flight with a blood alcohol level almost 10 times the legal limit. He had reportedly consumed two bottles of wine and more than 1.8 liters (nearly four US pints) of beer over six hours on the night before the flight. ANA also revealed last year that a hungover pilot had caused multiple flight delays. Before the rule change in January, Japan had no legal limits on drinking by plane crew members before flights, and breath testing was not required.
S. Korea to begin 5G service in March
SEOUL: South Korea’s finance minister said today that Seoul will become the first country in the world to start commercial operations of fifth-generation mobile network services next month.
Hong Nam-ki made the announcement at a meeting with senior officials on innovation-led growth in Seoul. KT Corp., South Korea’s leading wireless and fixed-line services provider, carried out a world first
trial service of its 5G system during the PyeongChang Winter Olympics last year. 5G data transmission speeds are 40-50 times faster than the existing 4G network or long-term evolution (LTE) and are expected to open a wide range of new business opportunities for the communication service sector.
The system, moreover, allows greater numbers of people to communicate with each other at the same time and promises to open vast markets for devices and services. The finance minister also said KT and two other local competitors – SK Telecom Co. and LG Uplus Inc. – will invest some 3 trillion won (US$2.6 billion) this year to set up seamless 5G connectivity in the country going forward.