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GLOBAL MARKETS-Stocks inch up on trade hopes but growth fears cap gains

Published 24/09/2019, 03:48 pm
© Reuters.  GLOBAL MARKETS-Stocks inch up on trade hopes but growth fears cap gains
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* S&P500 futures gain after Mnuchin comments on trade talks

* Dismal euro zone data hurts euro, deepens anxiety about economy

* European shares seen up 0.2-0.3%

By Hideyuki Sano

TOKYO, Sept 24 (Reuters) - Global shares edged up on Tuesday after U.S. Treasury Secretary Steven Mnuchin confirmed U.S.-China trade talks will resume next month, but lingering concerns about slowing global growth reduced the overall appetite for riskier assets.

MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS inched up 0.1%, led by 0.6% gains in mainland Chinese shares .CSI300 after the vice head of China's state planner said Beijing will step up efforts to stabilise growth. Nikkei .N225 was up 0.2% after a market holiday on Monday while European shares are also on track to open higher, with pan-European Euro Stoxx 50 futures STXEc1 up 0.26%, German DAX futures FDXc1 up 0.24% and FTSE futures FFIc1 up 0.33%.

U.S. stock futures ESc1 gained 0.38%, helped by comments from Mnuchin that U.S.-China trade talks will resume next week. He later clarified that the negotiations will take place in two weeks. comments gave a little bit of boost to sentiment, but markets are still not that optimistic either," said Masahiro Ichikawa, senior strategist at Sumitomo Mitsui DS Asset Management.

"It seems there have been a lot going on behind the scenes," he said, referring to unusual exchanges in which U.S. President Donald Trump questioned a decision by his top trade negotiators to ask Chinese officials to delay a planned trip to U.S. farming regions. cancellation was seen by markets as a sign all is not well in the U.S.-China talks and helped send share prices lower on Friday.

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The dispute between the world's two largest economies has dragged on for well over a year, rattling investors and denting global growth.

Concerns over a slowing global economy remained front and centre for financial markets, hurting earnings estimates, as poor business activity readings from the euro zone deepened fears of a recession and suggested more stimulus was required. the Nikkei was fairly well supported, we need more catalysts to further rises. That's also true for U.S. markets as well," said Takeo Kamai, head of execution service at CLSA.

"Although speculators have reacted to the trade-related headlines, real-money people appear to be staying on the sideline."

The euro wobbled at $1.0987 EUR= , falling below a key support around $1.10 and not far from a 28-month low of $1.0926 touched earlier this month.

Sterling also slipped to $1.2431 GBP=D4 , after peaked at a two-month high of $1.2582 set on Friday as traders awaited a Supreme Court ruling on whether Prime Minister Boris Johnson misled Queen Elizabeth over his reasons for suspending parliament this month. Supreme Court said it will issue its decision at 0930 GMT on Tuesday.

The collapse of the British travel firm Thomas Cook TCG.L could also put some pressure on the pound by highlighting the weakness of British retailing. yen traded at 107.62 yen per dollar JPY= , having hit two-week highs of 107.32 on Monday.

U.S. Treasuries yields extended their decline, with the 10-year rate falling to 1.716% US10YT=RR , edging down further from 1.908% marked on Sept. 13.

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Oil prices also dipped amid gloomy demand outlook as investors fret about a global slowdown although uncertainty on whether Saudi Arabia would be able to restore full output after the attacks on its facilities provided some support.

Brent crude LCOc1 futures fell 0.52% to $64.43 a barrel while U.S. West Texas Intermediate (WTI) crude CLc1 lost 0.48% to $58.36 per barrel.

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