The global equity markets are very sensitive to the macro-economic variables and news related to the trade war between the US and China. The geopolitical worries have the potential to dampen the sentiments of market players and, as a result, they tend limit their deployments towards equity markets. Also, some of the market players even tend to sell their present holdings because of the increasing uncertainties which negatively impact the broader momentum of global equity markets. Therefore, the permanent settlement of trade dispute between the US and China is very important because the settlement could bring the much-needed stability in the global equity markets.
Also, the increasing worries about the trade battle might impact the business environment which is detrimental to the health of global economy. The rising trade worries have the potential to significantly impact the broader economy and this could infuse increased volatility in the global markets. On May 10, 2019, Dow Jones Industrial Average ended the day in green as the index got closed at 25,942.37 which implies a rise of 114.01 points or 0.44% on an intraday basis. On the same day, S&P 500 index got closed at 2,881.40 which reflects an increase of 10.68 points or 0.37%.
Oil Prices Might Also Get Influenced With Rising Trade Worries
The oil prices are very sensitive to overall health of the global economy and a rise in geopolitical worries can influence the movement in oil prices. Therefore, the worries related to the trade war between the US and China can affect the oil prices. Also, as the economic uncertainties increase, the demand of oil also comes into question. Therefore, the settlement of the geopolitical concerns are of utmost importance in order to bring stability in the global economic environment.
Australian Market Closed in Red: S&P/ASX200 Falls 0.2%
The Australian equity market might also get negatively impacted if the trade battle between the US and China becomes worse. The rising tensions about global economic slowdown can influence the momentum of broader equity market in Australia. The settlement of trade battle might also help the Australian market. Today (i.e. May 13, 2019), S&P/ASX200 closed at 6,297.6 which reflects a fall of 13.3 points or 0.2% on an intraday basis. We will now have a look at the performance of some of the stocks.
LendLease Group (ASX: LLC) and Technology One Limited (ASX: TNE) closed the session in green as the prices of these stocks witnessed an increase of 8.713% and 3.169%, respectively. On the other hand, the stock prices of Reliance Worldwide Corporation Limited (ASX: RWC) and Smartgroup Corporation Ltd (ASX: SIQ) encountered a fall of 15.618% and 5.316%, respectively. RWC was primarily impacted by market’s reaction to its revised EBITDA guidance.
Let us now have a look at some important news. AusNet Services Limited (ASX: AST) came forward and made an announcement about FY 2019 results. To read the full news related to this, please click here. Also, Kirkland Lake Gold Ltd (ASX: KLA) made an announcement about Q1 FY 2019 results. To read the entire news about this, please click here.
Comparative Price Chart for LLC, TNE, RWC (Source: Thomson Reuters)
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