Yahoo Finance Global Equity Markets Weaken After Trump-Kim Summit Ends Abruptly
The major European stock indexes are trading lower on Thursday, following the lead in Asia. Geopolitical news is the major concern for investors today with traders keeping an eye on the Trump-Kim summit and U.S.-China trade relations. Brexit and military activity between India and Pakistan are also creating worries. Uncertainty tends to make investors nervous which encourages them to reduce risk.
At 07:29 GMT, the FTSE 100 Index is trading 7107.20, down 43.92 or -0.61%.
Trump-Kim Summit Cut Short
Stocks in Asia are falling sharply, led by a steep sell-off in shares in South Korea, after the White House announced that the ongoing Vietnam summit between U.S. President Donald Trump and North Korean leader Kim Jong Un on Thursday had been cut short with no agreement reached.
According to reports, President Trump said his team was presented with several options and decided to “walk away.”
“It wasn’t a good thing to be signing anything,” Trump said during a post-summit news conference. “We had some options, and at this time we decided not to do any of the options.”
Nonetheless, Trump described the talks as productive, and highlighted his relationship with Kim.
“Basically, they wanted the sanctions lifted in their entirety and we couldn’t do that,” Trump said. “We had to walk away from that particular suggestion. We had to walk away from that.”
American Secretary of State Mike Pompeo said during the news conference that the U.S. team “didn’t get to anything that made sense for the United States of America.”
“The two leaders discussed various ways to advance denuclearization and economic driven concepts,” White House spokeswoman Sarah Sanders said. “No agreement was reached at this time, but their respective teams look forward to meeting in the future.”
Asian Shares Tumble
The major stock indexes in Asia are under pressure on the news that the summit’s schedule had been cut short. South Korean stocks were hit the hardest.
In South Korea, the KOSPI closed at 2195.44, down 39.35 or -1.76%. China’s Shanghai Index finished at 2940.95, down 12.87 or -0.44%. Japan’s Nikkei 225 Index settled at 21385.16, down 171.35 or -0.79% and Hong Kong’s Hang Seng Index closed at 28627.65, down 129.79 or -0.45%.
U.S.-China Trade Talks Hit Snag
U.S. stocks hit their lows on Wednesday after U.S. Trade Representative Robert Lighthizer hinted that a trade deal was not yet certain, saying that any agreement would need to be more than just purchases by China.
There are also reports that the relationship between the Trump and Lighthizer is strained. Last week, Trump and Lighthizer sparred in front of journalists and Chinese representatives led by Vice Premier Liu He over whether “memorandum of understanding” is the right phrase to term the agreement that the U.S. and China are negotiating.
Additionally, on Wednesday, Lighthizer told the House Committee on Ways and Means that “much still needs to be down before an agreement is reached.” This contrasted with Trump’s earlier claims that a trade deal with China was already in “advanced states.”
Finally, one expert is concerned that Trump is going to overrule hardliner Lighthizer and that he would settle for an “inadequate” and “weak” deal with China.
This article was originally posted on FX Empire
