Business and Economy
Asian stocks slip on UK surprise election, weak earnings
Asian stocks fell Wednesday after British Prime Minister Theresa May’s surprise decision to hold early elections. Weak corporate earnings weighed on Wall Street investor sentiment. (Photo by Allan Ajifo [CC BY 2.0)
KEEPING SCORE: Tokyo’s Nikkei 225 edged up 0.1 per cent to 18,432.20 as the yen weakened slightly. South Korea’s Kospi shed 0.5 per cent to 2,138.40. Hong Kong’s Hang Seng index fell 0.3 per cent to 23,860.87 while the Shanghai Composite Index lost 0.8 per cent to 3,170.24. Australia’s S&P/ASX 200 was down 0.6 per cent at 5,804.00. Stocks in Taiwan, Singapore and the Philippines also fell.
UK ELECTIONS: May called for an early general election in June, reversing her earlier stance, in hopes of securing a stronger parliamentary mandate for Britain’s formal exit from the European Union. The pound climbed on expectations May might secure a better deal for Britain from the EU thanks to moving the vote up from the next scheduled election in 2020. The announcement sent the pound higher but hammered the FTSE 100 index. The pound was trading at $1.2822, down from $1.2840 but still higher than the pre-announcement level.
ANALYST’S TAKE: “The surprise U.K. election has added to market nerves and volatility as traders assess the potential for increased geopolitical risk on several fronts,” Ric Spooner, chief market analyst at CMC Markets, said in a commentary. “The outcome of the U.K. election now adds an element of short term uncertainty about how the Brexit negotiations will unfold.”
WALL STREET: U.S. stocks declined Tuesday as investors unloaded stocks following disappointing financial reports from Johnson & Johnson and Goldman Sachs. The Standard & Poor’s 500 index shed 0.3 per cent to 2,342.19. The Dow Jones industrial average lost 0.6 per cent to 20,523.28. The Nasdaq composite fell 0.1 per cent to 5,849.47.
OIL: U.S. crude oil futures lost 2 cents to $52.39 per barrel in electronic trading on the New York Mercantile Exchange. The contract lost 24 cents to close at $52.41 a barrel on Tuesday. Brent crude, used to price international oils, lost 5 cents to $54.85 per barrel in London.
CURRENCIES: The dollar rose to 108.71 yen from 108.42 yen. The euro fell to $1.0723 from $1.0731.
