A currency trader walks by the screen showing the Korea Composite Stock Price Index (KOSPI) at the foreign exchange dealing room in Seoul, South Korea, Friday, Sept. 10, 2021. Shares were higher in Asia on Friday as investors stepped up buying despite another decline on Wall Street that kept the S&P 500 and the Nasdaq on track for their first weekly losses in three weeks.(AP Photo/Lee Jin-man)
World shares advanced Friday after President Joe Biden spoke by phone with China’s Xi Jinping.
Benchmarks rose in Paris, London, Tokyo, Shanghai and Hong Kong. The yield on the 10-year Treasury note was steady at 1.31% and U.S. futures were higher. Crude oil prices rose.
Biden initiated the 90-minute call with Xi, which centered on discussing the way ahead for the U.S.-China relationship. The White House said the leaders during the call agreed to engage “openly and straightforwardly” on issues where the nations are at odds and where there is agreement.
“President Biden and Xi’s phone call has spurred hopes of a thaw in U.S.-China relations. That is ostensibly good for trade everywhere and spurred a decent rally in stocks across Asia,” Jeffrey Halley of Oanda said in a commentary.
Investors appeared to take in stride a decision by the European Central Bank on Thursday to dial back some of its massive emergency pandemic support for the economy as the 19 countries that use the euro rebound from the coronavirus recession.
Analysts said investors were reassured by ECB head Christine Lagarde's insistence that the shift was only a “recalibration” of existing stimulus — not a signal that pandemic support is being phased out.
Germany's DAX gained 0.1% to 15,643.96 and the CAC 40 in Paris rose 0.4% to 6,7089.48. Britain's FTSE 100 picked up 0.3% to 7,047.34. Th future contract for the Dow industrials was trading 0.5% higher, while the future for the S&P 500 climbed 0.4%,
In Asian trading, Tokyo's Nikkei 225 gained 1.3% to 30,381.84 while the Hang Seng in Hong Kong jumped 1.9% to 26,205.91. South Korea's Kospi added 0.4% to 3,125.76. The Shanghai Composite index climbed 0.5% to 3,703.11.
Investors have been assessing the pace of economic growth amid worries that the rapid spread of the coronavirus delta variant will dampen consumer confidence and spending.
In New York, the S&P 500 fell 0.5%, its fourth straight drop, to 4,493.28. The Nasdaq pulled back 0.3%, to 15,248.25.
The Dow Jones Industrial Average fell 0.4% to 34,879.38.
Small company stocks fared better than the broader market. The Russell 2000 index gave up 0.60 points, or less than 0.1%, to 2,249.13.
Fed officials have indicated they expect to dial back on stimulus measures by year’s end, and Treasury Secretary Janet Yellen has warned Congress that she will run out of maneuvering room to prevent the U.S. from breaching the government’s borrowing limit in October unless the debt ceiling is raised.
In other trading, U.S. benchmark crude oil rose 73 cents to $68.87 per barrel in electronic trading on the New York Mercantile Exchange. It gave up $1.16 to $68.14 per barrel on Thursday.
Brent crude rose 89 cents to $72.34 per barrel.
The U.S. dollar rose to 109.96 Japanese yen from 109.73 yen. The euro was trading at $1.1842, up from $1.1825 late Thursday.7 Stocks That Can Withstand a Taper Tantrum
The stock market is stimulated like a child with a sugar high on Halloween night, and investors are enjoying the ride. It seems like nearly every sector continues to point in one direction. But seasoned investors know that the markets don’t move in the same direction all the time. And even long-term bulls admit that a correction may be coming.
One reason for this is that the Federal Reserve (i.e. “The Fed”) is “talking about, talking about” an end to its asset purchase program. If that talk turns into concrete action, then it would be almost a sure sign that interest rates will rise sooner than expected.
That combination is typically negative for equities, such as stocks. Yet, even if the Fed announces an earlier-than-expected tapering plan, there are stocks that will hold up well and even thrive. And that’s the focus of this presentation. We’re taking a looks at seven stocks that stand to benefit from a less accommodative monetary policy.
Financial stocks are one group of stocks that will benefit from rising interest rates. And you should also consider stocks with a high return on equity (ROE).
ROE = Net Income/Shareholders’ Equity
Stocks with a high ROE are reinvesting cash at a high rate of return which can make them an ideal choice when that cash becomes more valuable.
View the "7 Stocks That Can Withstand a Taper Tantrum"