BUSINESS World stocks slip as tax jitters sap confidence


World stocks slip as tax jitters sap confidence


04:25, November 11, 2017


World markets slid a little further down a slipperly slope Friday. Photo: AFP

Global stock markets retreated Friday, extending the previous session's losses, as uncertainty over US President Donald Trump's much-vaunted tax cut plans and lacklustre corporate earnings took their toll on investor confidence.

Stock markets are dropping "on more worry about the US Senate delaying a proposed US corporate tax cut", said Accendo Markets analyst Michael van Dulken.

"Coupled with some more disappointing earnings reports, this served to undo a little more of equities' recent ascent to record highs."

London's benchmark FTSE 100 index was down 0.7 percent on the day at the closing bell.

In Britain, "a fall in the trade deficit and improvement in manufacturing and industrial production has helped to lift the pound", noted Chris Beauchamp, chief market analyst at IG trading group.

A stronger pound tends to weigh on the share price of exporters.

In the eurozone, Frankfurt's DAX 30 lost 0.4 percent and the Paris CAC 40 shed 0.5 percent, extending sharp Thursday drops of up to 1.5 percent for the bloc's main indices.

- 'Pretty challenging' -

Global stock markets were sent surging last month when Trump's administration unveiled a plan to slash taxes across the board in a bid to fire up the US economy.

But in recent days it has emerged Republicans have differing ideas about how to push them through, with senators calling for a one-year delay to corporate tax cuts.

House Speaker Paul Ryan has insisted that the details will be "ironed out" between the two competing plans but analysts said there are worries the overhaul could succumb to party infighting of the kind that killed Trump's healthcare reforms.

"Given the apparent differences between the two bills, the implementation of tax reform before the end of the year looks pretty challenging and achieving it before Thanksgiving (November 23) seems close to impossible," Rodrigo Catril, a foreign exchange strategist at National Australia Bank, said in a note to clients.

Wall Street was down 0.2 percent approaching midday in New York.

In commodities trading, oil prices were up amid growing tensions in the crude-rich Middle East, after Saudi Arabia accused Iran of "direct military aggression" over a missile attack near Riyadh by Tehran-backed Yemeni rebels.

- Key figures around 1640 GMT -

London - FTSE 100: DOWN 0.7 percent at 7,43.99 points (close)

Frankfurt - DAX 30: DOWN 0.4 percent at 13,127.47 (close)

Paris - CAC 40: DOWN 0.5 percent at 5,380.72 (close)

EURO STOXX 50: DOWN 0.2 percent at 3,593.76

New York - DOW: DOWN 0.2 percent at 23,425.13

Tokyo - Nikkei 225: DOWN 0.8 percent at 22,681.42 (close)

Hong Kong - Hang Seng: DOWN 0.1 percent at 29,120.92 (close)

Shanghai - Composite: UP 0.1 percent at 3,432.67 (close)

Euro/dollar: UP at $1.1657 from $1.1642 at 2200 GMT

Pound/dollar: UP at $1.3202 from $1.3145

Dollar/yen: DOWN at 113.21 yen from 113.42 yen

Oil - Brent North Sea: UP 13 cents at $64.06 per barrel

Oil - West Texas Intermediate: UP 8 cents at $57.25

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