Global Stocks Rise as China's Economy Shows Gains
December 16 2019 - 6:48AM
Dow Jones News
By Avantika Chilkoti
Global stocks started the week higher as data signaled an
improvement in the Chinese economy, adding to optimism that some of
the biggest risks to markets are clearing.
Futures tied to the Dow Jones Industrial Average edged up 0.2%
on Monday, while the Stoxx Europe 600 index gained over 1%. In
Asia, the Shanghai Composite Index closed up 0.6%.
Fresh data showed that Chinese economic activity, including
factory production and consumer spending, improved in November. The
better-than-expected results for industrial production and retail
sales may help alleviate investors' concerns about growth in the
world's second-largest economy.
Markets were buoyed last week as some of the major risks facing
global economic growth -- the U.S.-China trade spat, changes to the
North American Free Trade Agreement and uncertainty around Brexit
-- appeared to ease. On Friday, the U.S. reached a truce with China
after securing a pledge from Beijing to boost purchases of
agricultural products, bringing to a temporary halt to tensions
that have rocked markets for most of this year.
Ahead of the opening bell in New York, shares in Boeing declined
2.4% in premarket trading. The aerospace company is considering
either suspending or cutting back production of the 737 MAX, The
Wall Street Journal reported. Deepening production cuts would
inflate Boeing's costs and trigger charges against its financial
results as fixed expenses would be spread among fewer planes.
International Flavors & Fragrances Inc. fell 5.9% after
DuPont de Nemours reached a deal to combine its nutrition business
with IFF in a deal that will give DuPont a $7.3 billion cash
payment and about 55.4% of the new company.
Over in the U.K., the FTSE 100 index, which tracks the biggest
companies in the country, rose over 2% in its largest one-day rally
since February. The gauge is extending gains from last week
following Prime Minister Boris Johnson's resounding majority in the
general elections. The result, analysts said, paves the way for the
U.K. to leave the bloc at the end of next month, clearing some of
the political uncertainty that has hung over the economy since the
2016 Brexit referendum.
"It takes the risk of a no-deal Brexit immediately off the table
and it gives you some certainty, so that's better than where we
were," said Thomas Pugh, U.K. economist at Capital Economics.
Within European equities, shares in Electrolux dropped over 10%
after the Swedish appliance maker announced that a reorganization
of its manufacturing in the U.S. will hit fourth-quarter operating
income.
Write to Avantika Chilkoti at Avantika.Chilkoti@wsj.com
(END) Dow Jones Newswires
December 16, 2019 06:33 ET (11:33 GMT)
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