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Global markets: stocks fall on China exec arrest; oil slips on OPEC output delay

Reuters  |  NEW YORK 

By Laila Kearney

(Reuters) - Stock markets around world slid on Thursday as the arrest of a top Chinese cast further shadows on U.S.-trade relations, while sank after delayed an output decision.

The arrest of maker Technologies Co. in for extradition to the came as and prepared for talks aimed at resolving a bitter trade spat.

Sources familiar with the probe told Meng was arrested as part of a U.S. investigation of an alleged scheme to use the global system to evade U.S. sanctions against

Wall Street tumbled in early trade before paring some losses by the afternoon.

The Dow Jones Industrial Average <.DJI> fell 351.2 points, or 1.4 percent, to 24,675.87, the S&P 500 <.SPX> lost 34.86 points, or 1.29 percent, to 2,665.2 and the Nasdaq Composite <.IXIC> dropped 44.40 points, or 0.62 percent, to 7,114.03. The pan-European STOXX 600 index <.STOXX> lost 3.09 percent and MSCI's gauge of stocks across the globe <.MIWD00000PUS> shed 1.68 percent. MSCI's broadest index of shares outside <.MIAPJ0000PUS> closed 2.08 percent lower, while Japan's Nikkei <.N225> lost 1.91 percent.

"Clearly, the arrest was the individual catalyst that caused today's moves lower," said Mark Hackett, at Nationwide. Canadian authorities late on Wednesday said they had arrested Meng, also the daughter of Huawei's founder, on Dec. 1, the same day that U.S. and Chinese leader met at the summit in

The world's two economic superpowers had agreed on a 90-day trade truce period to hammer out a more permanent agreement, which sent global stock markets soaring on Monday. Equities reversed course the next day as uncertainty grew that the world's two largest economies could, in fact, find common ground.

"The potential slowdown in global growth is also something the markets are in," said Art Hogan, at in

Earlier this week, shorter-dated yields rose above medium-dated yields for the first time since early 2008, which fanned fears about a U.S. recession in the coming months and also sent Wall Street shares sliding.

yields pared some of the decline as Wall Street trimmed losses after flailing early in the day, with 10-year yields hitting three-month lows as worries about U.S.-trade and Brexit spurred safe-haven bids.

Additionally, traders scaled back expectations on the number of rate hikes the Federal Reserve would implement amid weakening economic data and market volatility.

U.S. jobs data is due on Friday. If the figures show any serious weakness, markets are likely to react, said Shuji Shirota, HSBC's of macro economic strategy.

The U.S. dollar fell against major peers on lower Treasury yields and as traders scaled back rate hike expectations.

The euro was 0.32 percent higher against the dollar at $1.1380.

Gold prices, which move inversely with the dollar, held near a five-month peak as the greenback and equities slipped.

fell about 3 percent in choppy trading after the Organization of the Exporting Countries ended a meeting without making a decision on crude output.

met in to decide on production policy in coordination with other countries, including Russia, and The organization said it had agreed on a tentative deal to cut but had not yet come up with a final figure.

U.S. crude settled down 2.65 percent at $51.49 per barrel and Brent was last at $60.06, down 2.44 percent on the day.

Graphic: World FX rates in 2018

(Additional reporting by Marc Jones, Lewis Krauskopf, Shreyashi Sanyal, Devika Krishna Kumar, Amanda Cooper; Editing by and Dan Grebler)

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Fri, December 07 2018. 02:00 IST