Breaking News
0

Shares sapped by tech problems and Brexit snags

Stock MarketsOct 23, 2019 07:34AM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
 
© Reuters. FILE PHOTO: A trader works as a screen shows market data behind him in London

By Marc Jones

LONDON (Reuters) - World stock markets struggled on Wednesday, as hopes faded that a Brexit deal would be wrapped by next week and a profit warning from Texas Instruments pulled down technology shares.

It was hard to pick which was weighing on sentiment more in European trading. The pound was yanked down to $1.2850 from $1.30 after UK lawmakers put the brakes on the government's Brexit plans again on Tuesday.

Meanwhile, Europe's tech sector (SX8P) fell as much as 1.4% as STMicroelectronics (MI:STM), Dialog Semiconductor (DE:DLGS) and Infineon (DE:IFXGn) all dropped after Texas Instruments slumped 10% (O:TXN) in after-hours Wall Street trading. (EU)

Major Asian chipmakers, including Taiwan's TSMC (TW:2330) and South Korea's SK Hynix (KS:000660), had fallen overnight too on worries the industry was being squeezed both by a downturn in global demand and by the U.S.-China trade war.

"When there are tensions in trade and obstacles to trade, what do businesses do? They become more cautious. And they pull back," Rafael Lizardi, Texas Instruments' chief financial officer, said after the company's results.

With investors seeking out safer assets again, the Japanese yen climbed to a one-week high of 108.25 per dollar and the Swiss franc gained early in Europe.

Adam Cole, a strategist at RBC Capital Markets, said Brexit was driving a "general risk-off tone." Others pointed to the growing likelihood British Prime Minister Boris Johnson would now push for a snap election.

"Things could change very quickly today, depending on the EU response," Cole said, referring to how much EU leaders would be prepared to extend the Brexit deadline beyond Oct. 31.

But he added he didn't see "much downside" risk for sterling now, with a no-deal Brexit off the table.

The pound has surged 4.5% this month which, if it holds the gains, will be its best month since January last year.

Receding worries about a no-deal Brexit also underpinned the euro at $1.1122 (EUR=), just below a two-month high of $1.1180, though it was also down to the dollar staying subdued before an expected third U.S. interest rate cut of the year next week.

In a mirror image of the pound and euro, October is on course to see the biggest monthly fall in the dollar index (DXY) since January 2018. It has only fallen for six of the months during that period too.

CAT WARNING

Equities on Wall Street looked set for another sluggish start. Hopes for forgetting Texas' woes were already dashed as digger giant Caterpillar (N:CAT) blamed a weak global construction market as it cut its profit forecast after a hefty 13.5% fall in third quarter profits.

In commodity markets, oil prices fell after data showed U.S. crude inventories grew more than expected last week. But prices generally held firm after China signaled hopes for progress in upcoming trade talks with the United States and OPEC and its allies considered deeper cuts in production.

Brent crude (LCOc1) futures fell 0.52% to $59.39 a barrel. U.S. West Texas Intermediate crude (CLc1) lost 0.81% to $54.04 per barrel.

Shares sapped by tech problems and Brexit snags
 

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind: 

  • Enrich the conversation
  • Stay focused and on track. Only post material that’s relevant to the topic being discussed.
  • Be respectful. Even negative opinions can be framed positively and diplomatically.
  •  Use standard writing style. Include punctuation and upper and lower cases.
  • NOTE: Spam and/or promotional messages and links within a comment will be removed
  • Avoid profanity, slander or personal attacks directed at an author or another user.
  • Don’t Monopolize the Conversation. We appreciate passion and conviction, but we also believe strongly in giving everyone a chance to air their thoughts. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
Comments
holy piger
holy piger Oct 23, 2019 5:37AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
and uk
holy piger
holy piger Oct 23, 2019 5:37AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
i cant feel it, look at dax and euro
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
Continue with Google
or
Sign up with Email