Lam’s Move Lifts Stocks Globally
The Hang Seng index jumped 4% on news that Hong Kong chief executive Carrie Lam will withdraw completely a divisive extradition bill at the heart of the Hong Kong protests. The news kicked off a global rally in stocks following losses yesterday. The news triggered gains in the U.S. as well, as conventional wisdom suggests that China is now better able to focus on trade. This no-bad-news-is-good-news optimism persists despite little evidence of actual progress in trade talks.
The major three stock indexes were all up, with the DJIA closing at 0.91%, the NASDAQ up 1.3%, and the S&P 500 up 1.08%.
Oil Reverses Losses
After three losing trading sessions this week, November Brent crude rose 4.2% to settle at $60.70 a barrel. The move is based on the same optimism of reduced tension in China and around U.S.-China talks, but also on speculation that U.S. oil supplies are decreasing.
Sterling Up Despite Brexit Turmoil
After the drama of yesterday’s rebuke of Boris Johnson, Parliament voted to approve a law preventing a no-deal Brexit on October 31st. For his part, Johnson sacked the 21 MPs who betrayed his Conservative party and has called for a snap election in mid-October. It is unclear whether Johnson has the support to get an election approved.
In any case, the pound rose 0.8% today after testing the symbolic 1.20 level versus the dollar.