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GLOBAL MARKETS-Trade hopes lift stocks; emerging markets get boost from Turkey rate hike

Stock MarketsSep 14, 2018 10:50
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GLOBAL MARKETS-Trade hopes lift stocks; emerging markets get boost from Turkey rate hike

* World stocks index touches more than 1 week high

* Emerging market stocks rise after Turkey rate hike

* Chinese markets, copper still under pressure

By Trevor Hunnicutt

NEW YORK, Sept 14 (Reuters) - An index of world stock markets climbed to its highest in over a week on Friday as expectations grew that the United States and China would start fresh trade talks, while an interest rate hike in Turkey supported the lira and emerging markets.

The MSCI All-Country World index .MIWD00000PUS , which tracks shares in 47 countries, rose 0.24 percent and touched its highest since Sept. 4.

On Wall Street, the Dow Jones Industrial Average .DJI rose 10.01 points, or 0.04 percent, to 26,156, the S&P 500 .SPX gained 0.41 points, or 0.01 percent, to 2,904.59 and the Nasdaq Composite .IXIC added 16.67 points, or 0.21 percent, to 8,030.38. .N

The pan-European STOXX 600 index .STOXX gained 0.28 percent. .EU

Chinese shares retreated as data showed real estate investment in the country fell in August, raising concern that a cooling property market could increase risks for Beijing's economic outlook as the trade environment worsens. benchmark Shanghai Composite index .SSEC fell 0.2 percent while the blue-chip CSI 300 .CSI300 rose 0.2 percent.

Chinese officials welcomed an invitation from U.S. Treasury Secretary Steven Mnuchin to new trade talks. But President Donald Trump tempered market expectations, tweeting on Thursday that Washington was "under no pressure to make a deal with China." Trump administration is readying a final list of $200 billion worth of imports from China, the world's No. 2 economy, that it plans to impose tariffs on in the coming days. That move would escalate the trade war between the two countries and could significantly slow global growth.

"While the potential for a trade deal in the near-term remains low, a resumption of dialogue could lift sentiment and support markets," analysts at Credit Suisse (SIX:CSGN) wrote in a note to clients.

Benchmark 10-year Treasury notes US10YT=RR hit the psychologically significant 3 percent level for the first time in more than a month as prices on U.S. government bonds fell on economic data that seemed solid enough to support plans by the Federal Reserve to raise rates another two times in 2018. HIKE LIFTS LIRA

A sharp interest rate increase by Turkey's central bank to support a tumbling lira boosted risk appetite in emerging markets. The bank hiked its benchmark interest rate TRINT=ECI by more than one-third to 24 percent. crises in both Turkey and Argentina have stoked fears of contagion over the past several weeks, hammering emerging market assets from Indonesia and India to South Africa.

Turkish lira TRYTOM=D3 implied volatility gauges fell to their lowest in more than a month, as sentiment continued to improve. bold decision (by Turkey's central bank) reduces the risk that a full-scale financial crisis may unfold," wrote analysts at Rabobank in a note to clients.

"The central bank's efforts must be accompanied by an implementation of constructive macro prudential policies by the administration."

Emerging market stocks .MSCIEF rose 0.96 percent, though copper, used heavily by China, lost 1.18 percent to $5,962.00 a tonne. CMCU3

Oil prices slipped after a week of back-and-forth swings. U.S. crude CLcv1 fell 0.41 percent to $68.31 per barrel and Brent LCOcv1 was last at $77.79, down 0.5 percent on the day.

<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ Emerging market currencies battered

https://reut.rs/2p8rvKO World FX rates in 2018

http://tmsnrt.rs/2egbfVh

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GLOBAL MARKETS-Trade hopes lift stocks; emerging markets get boost from Turkey rate hike
 

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