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GLOBAL MARKETS-World stocks end four-day winning streak as U.S.-China tensions grow

Published 07/08/2020, 09:26
Updated 07/08/2020, 09:30
© Reuters.
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* Graphic: 2020 asset performance http://tmsnrt.rs/2yaDPgn
* Graphic: World FX rates in 2020 http://tmsnrt.rs/2egbfVh

By Saikat Chatterjee
LONDON, Aug 7 (Reuters) - World stocks ended four days of
gains on Friday after U.S. President Donald Trump cranked up
simmering tensions with China by banning U.S. transactions with
two popular Chinese apps, Tencent (HK:0700)'s WeChat and ByteDance's
Tiktok.
Chinese stocks led losers in Asia and its currency slumped
after Trump issued the executive orders. His administration said
this week it was stepping up efforts to purge "untrusted"
Chinese apps from U.S. digital networks and called TikTok and
WeChat "significant threats." "The U.S. pressure on China's tech sector appears likely to
continue in the presidential elections, injecting volatility in
the sector and opening the door to escalatory retaliation," UBS
strategists said.
European stocks opened lower, with major indexes down
between 0.2% to 0.4% in early trading .STOXX .FTSE .
MSCI's broadest index of world stocks .MIWD00000PUS fell
0.2% on Friday after up four consecutive days of gains. It was
less than 3% away from a late February peak.
Asia-Pacific shares outside Japan .MIAPJ0000PUS fell 1%,
with mainland Chinese indexes down more than 1% each, even
though Chinese trade data for July showed exports beat
expectations. Risk appetite was also subdued on Friday with hopes fading
for a quick deal by U.S. policymakers on stimulus worth at least
$1 trillion to support the country's fragile economy. The White
House and Democrats remained far apart on the size of the
stimulus package and what to include. The risk-off mood pushed U.S. Treasury yields lower and
offered a brief respite to the struggling dollar, which has been
under pressure in recent weeks. The 10-year U.S. Treasury yield
US10YT=RR dipped 1.1 basis points to 0.5198%, near Thursday's
five-month low of 0.504%.
Closely watched U.S. non-farm payrolls data, due at 1230
GMT, is expected to show an increase of 1.58 million in July,
compared with 4.8 million in June.
Gold XAU= hit a record high of $2,075.2 per ounce XAU=
before succumbing to profit-taking to slip to $2,063.
Silver dropped 1.7% to $28.452 per ounce XAG= following
its rise to a seven-year high of $29.838.
Oil prices were little changed, with Brent futures LCOc1
down 0.1% at $45.04 per barrel.
For Reuters Live Markets blog on European and UK stock
markets, please click on: LIVE/


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