SEOUL, South Korea/January 11, 2018 (AP)(STL.News) —Global stocks stabilized Thursday after a tumble the day before that was triggered by reports, later rejected, that China may slow its massive purchases of U.S. government bonds.
KEEPING SCORE: Britain’s FTSE 100 rose 0.2 percent to 7,761 and France’s CAC 40 was up 0.1 percent at 5,507. Germany’s DAX dipped 0.1 percent to 13,270 despite data showing the economy grew last year at its fastest pace in six years. Futures augured small gains on Wall Street, with S&P and Dow futures both up 0.2 percent.
CHINA: A report by Bloomberg News said China is considering slowing or halting its purchases of U.S. Treasurys, which helped push yields higher and led to the first daily loss on Wall Street’s main stock benchmarks. The yield on the 10-year Treasury reached its highest level since March at one point before pulling back. China’s foreign exchange regulator challenged the report that it might slow or stop purchases of U.S. Treasury debt due to trade tensions with Washington as “fake news.”
ANALYST’S TAKE: “Justifiably, Beijing’s biggest worry is that the value of its U.S. bond holdings will be eroded substantially by rising inflation and supply,” analysts from Mizuho Bank Ltd. said in a daily commentary. But they added that “Doubts about (U.S. bonds) allure should not be overblown as a threat of imminent dumping.”
BITCOIN: Bitcoin prices gyrated, sinking about 13 percent according to website Coindesk, after South Korea’s justice minister said it plans to ban crypto currency trading. South Korea’s presidential office later said the ban is under review and no decision has been made on whether or not to implement it. The justice ministry has taken the sternest stance on digital currencies among South Korean ministries but other government agencies reportedly oppose an outright ban on bitcoin and other virtual currency trading. By early afternoon in Europe, bitcoin was down 8 percent at $13.659.
ASIA’S DAY: Japan’s Nikkei 225 fell 0.3 percent to 23,710.43 and South Korea’s Kospi retreated 0.5 percent to 2,487.91. Hong Kong’s Hang Seng index edged 0.2 percent higher to 31,120.39 and the Shanghai Composite index erased earlier losses to edge 0.1 percent higher at 3,425.34. Australia’s S&P/ASX 200 slumped 0.5 percent to 6,067.60. Most stock markets in Southeast Asia were weaker.
CURRENCIES: The dollar rose to 111.68 Japanese yen from 111.43 yen. The euro fell slightly to $1.1940 from $1.1948.
OIL: The price of oil remained supported by optimism about the global economy and a recent decline in the value of the dollar, which makes it more appealing as an investor for non-dollar investors. Benchmark U.S. crude was up 43 cents to $64.00 per barrel on the New York Mercantile Exchange. The contract added 61 cents on Wednesday. Brent crude, the international standard, gained 26 cents to $69.46 per barrel in London. It gained 38 cents on Wednesday.