Global markets bounce as US agrees deal to stop a fresh government shutdown


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Global stock markets are rallying for a second consecutive day Tuesday as investors take heart from news overnight that a fresh shutdown of the US government looks to have been averted.
The fresh shutdown, which was set to begin Saturday, has been kicked down the road thanks to a $1.4 billion funding deal.
Shares around the world have rallied, with Japan’s Nikkei climbing 2.6% during Tuesday trade, and Germany’s DAX rallying 1%.
You can follow the latest market movements at Markets Insider.

Global stock markets are rallying for a second consecutive day Tuesday as investors take heart from news overnight that a fresh shutdown of the US government looks to have been averted.

US lawmakers late Monday seemed to reach a deal on border security funding that would likely avert a fresh shutdown of parts of the government, which is set to begin Saturday. The government was shutdown for much of December and January, but a temporary deal to halt the shutdown was implemented in late January.

Reuters reports that while a tentative deal has been struck, the agreement does not contain the $5.7 billion President Donald Trump wants for a border wall.

“Equity markets in Asia followed Wall St’s lead higher following an agreement in principle by US lawmakers to avert a fresh government shutdown, granting President Trump $1.4 billion in funding for border controls, but only for bollard fencing not an actual wall, and well below his desired $5.8 billion,” Mike van Dulken, head of research at Accendo Markets wrote in an email.

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Alongside hopes that a fresh shutdown can be avoided, markets are buoyed by continued optimism that trade talks between Washington and Beijing will yield a positive outcome.

Representatives from the Trump and Xi administrations began talks in Beijing on Monday, with the aim of making progress towards a trade deal of some form before the 90 day deadline imposed at the G20 in Argentina late in 2018.

Talks will initially be conducted between relatively junior officials, before Treasury Secretary Steven Mnuchin and Trade Representative Robert Lighthizer take over on Thursday and Friday.

Both factors have contributed to a substantial rally in equities around the world, with Asian and European stocks jumping Tuesday, and US equities set to continue the strong start to the week they witnessed Monday. Here’s how things look around 10.00 a.m. GMT (5.00 a.m. EST):

Chinese markets continued their strong start to the week, with the Shenzhen Component index the biggest winner, gaining 1.2%. Elsewhere, gains were smaller, with the Shanghai Composite up 0.7%, and the China A50 just 0.1% higher.
Asia’s biggest winner on Tuesday was Japan’s Nikkei 225, which popped 2.6%, thanks partly to a weaker yen, and partly because Japanese markets were closed Monday, so investors missed out on the day’s gains.
In Europe, all major share indexes are higher during morning trading, with gains generally between 0.4% and 0.7%. Germany’s DAX is the biggest winner so far climbing 1% Tuesday, despite continued …read more

Source:: Businessinsider – Finance

      

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