Global stocks rise on hope for Hong Kong calm
BEIJING (AP) — Global stocks rose Wednesday as Hong Kong’s government withdrew a proposed extradition law that sparked three months of protests in the Chinese territory.
Hong Kong’s benchmark Hang Seng index jumped 3.9% on news of plans for the withdrawal, which Chief Executive Carrie Lam confirmed after markets closed. The protests have disrupted travel, adding to pressure from weakening global trade.
Elsewhere, benchmarks in London, Frankfurt, Shanghai and Tokyo rose as Britain’s Parliament fought over plans to leave the European Union and the U.S.-China trade dispute remained unresolved.
In midday trading, London’s FTSE 100 gained 0.3% to 7,292 and Frankfurt’s DAX added 1% to 12,026. France’s CAC 40 also picked up about 1% to 5,523. On Wall Street, futures for the S&P 500 index and the Dow Jones Industrial Average rose 0.8%.
The Shanghai Composite Index gained 0.9% to 2,957.41 and Tokyo’s Nikkei 225 advanced 0.1% to 20,649.76. The Hang Seng closed at 26,523.23.
The proposed Hong Kong law prompted complaints it would allow crime suspects to be sent to mainland China, where courts are controlled by the ruling Communist Party. Protesters complained Lam’s government and Beijing were eroding the “high degree of autonomy” promised when the former British colony returned to China in 1997.
The protests have broadened to include demands for universal democracy and for Lam to resign.
“Violence might ease in Hong Kong, but the protests are likely to continue” until other demands are met, said Edward Moya of Oanda in a report.
Seoul’s Kospi rose 1.2% to 1,988.53 and Sydney’s S&P-ASX 200 lost 0.3% to 6,553.00. India’s Sensex gained 0.3% to 36,669.76.
The global economic backdrop remains dark, however. On Tuesday, an index of U.S. manufacturing issued by the Institute for Supply Management, an association of purchasing managers, slid to a 3½-year low of 49.1 last month from July’s 51.2. Softer global demand, aggravated by the U.S.-Chinese tariff war, appears to be hurting American manufacturers.
In London, Parliament was preparing to defy Prime Minister Boris Johnson’s plans to leave the European common market even if the two sides fail to agree on future trade and other terms.
The House of Commons planned to confront Johnson over his insistence Britain leave the EU on Oct. 31. Parliament agreed to allow Johnson’s opponents to propose a law that would try to block a departure without a deal.
Johnson has said he will call an election to reinforce his position if the lawmakers succeed.
That “could again induce more volatility,” said Mizuho Bank in a report.
ENERGY: Benchmark U.S. crude gained 78 cents to $54.72 per barrel in electronic trading on the New York Mercantile Exchange. The contract fell $1.16 on Tuesday to close at $53.94. Brent crude, used to price international oils, gained 71 cents to $58.97 per barrel in London. It lost 40 cents the previous session to $58.26.
CURRENCY: The dollar gained to 106.21 yen from Tuesday’s 105.95 yen. The euro rose to $1.1009 from $1.0976.