World stocks slide as geopolitics, European votes weigh

AP News
Posted: Apr 18, 2017 8:01 AM
World stocks slide as geopolitics, European votes weigh

HONG KONG (AP) — World stocks fell Tuesday amid concerns about the security situation on the Korean Peninsula, France's upcoming presidential election, and Britain's surprise decision to hold a general election.

KEEPING SCORE: European benchmarks opened lower after the Easter holiday and kept sliding throughout the day. Britain's FTSE 100 was down 1.7 percent at 7,204, France's CAC 40 lost 1.2 percent to 5,010 and Germany's DAX shed 0.6 percent to 12,040. Wall Street was poised to open lower: Dow and S&P 500 futures fell 0.2 percent.

EUROPEAN ELECTIONS: With France's first-round vote due Sunday, polls don't give a clear edge to any of the four leading candidates. The top two candidates advance to a May 7 runoff and investors are unsettled by the chance that either of the far-left or far-right candidates could pull off a victory. Meanwhile, Britain added new uncertainty by calling for a general election in June. Theresa May's Conservatives are expected to do well, something she hopes will give her a stronger mandate to negotiate the Brexit deal with the European Union.

ANALYST TAKE: "It will take investors some time to digest the effects of the election in the next few days," Aberdeen Asset Management Investment Manager Luke Bartholomew said of the U.K. move. He says a stronger mandate could help May stand up to the more anti-EU members in her own party who want Britain to break off more cleanly from the EU, a prospect that would hurt business more.

CURRENCIES: The pound jumped on the hope that the election will result in May getting a better deal for Britain in the Brexit talks. It was up 0.9 percent on the day at $1.2675. Elsewhere, the dollar weakened to 108.79 yen from 108.90 yen in late trading Monday. The euro strengthened to $1.0684 from $1.0643.

NORTH KOREA: China's foreign minister issued a fresh appeal for calm after tensions escalated over Pyongyang's focus on developing missiles and nuclear weapons, including its latest failed missile launch. Wang Yi said he believes the United States prefers a diplomatic solution to the standoff, including multi-sided talks. His remarks follow a war of words between North Korea and the U.S., including remarks by U.S. Vice President Mike Pence's warning that U.S. "strategic patience" is over. But Pence's arrival in Tokyo on Tuesday shifts his attention from geopolitics to economic issues.

Hold The Damn Vote Already
Derek Hunter

ASIA'S DAY: Japan's benchmark Nikkei 225 index added 0.4 percent to 18,418.59 while South Korea's Kospi reversed early losses to edge up 0.1 percent to 2,148.46. Hong Kong's Hang Seng shed 1.4 percent to 23,924.54 and the Shanghai Composite Index shed 0.9 percent to 3,196.71. Australia's S&P/ASX 200 fell 0.9 percent to 5,836.70. Shares in Taiwan and Southeast Asia were higher.

ENERGY: Oil prices retreated. Benchmark U.S. crude futures fell 38 cents to $52.27 a barrel in electronic trading on the New York Mercantile Exchange. The contract lost 53 cents on Monday. Brent crude, used to price international oils, lost 50 cents to $54.86 per barrel in London.