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GLOBAL MARKETS-Dollar gains, stocks mostly ease as G7 summit in focus

Published 09/06/2018, 02:34 am
Updated 09/06/2018, 02:40 am
© Reuters.  GLOBAL MARKETS-Dollar gains, stocks mostly ease as G7 summit in focus
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* Stocks edge lower as G7 summit worries weigh

* Talk of Fed, ECB tightening adds to risk-off sentiment

* Crude oil prices fall (Updates with midday U.S. markets activity, changes byline, dateline, previous LONDON)

By Caroline Valetkevitch

NEW YORK, June 8 (Reuters) - Stocks on global indexes mostly eased while the dollar rose on Friday as expectations that trade tensions will dominate the Group of Seven countries' summit weighed on sentiment.

MSCI's gauge of stocks across the globe .MIWD00000PUS shed 0.31 percent. It was still on track, however, to break a three-week streak of losses. U.S. stocks were nearly flat.

Investors were anxious about the G7 summit, kicking off Friday in Quebec, where mounting risks of a tariff war between the United States and its major trade partners are in the spotlight. divide has been widening between U.S. President Donald Trump and the group's remaining six members after Trump imposed tariffs on steel and aluminum imports from Canada, Mexico and the European Union last week.

"I suspect that expectations from the G7 have been reduced," said Eric Wiegand, senior portfolio manager at U.S. Bank Private Wealth Management.

"Expectations have been very modest that there will be much of a productive nature to these meetings."

The pan-European FTSEurofirst 300 index .FTEU3 lost 0.25 percent.

The Dow Jones Industrial Average .DJI rose 24.95 points, or 0.1 percent, to 25,266.36, the S&P 500 .SPX gained 0.54 point, or 0.02 percent, to 2,770.91 and the Nasdaq Composite .IXIC dropped 6.82 points, or 0.09 percent, to 7,628.25.

Expectations of more interest rate hikes in the United States, and the prospect that the European Central Bank will soon signal a winding-down of its massive monetary stimulus also contributed to the risk-off tone, investors said.

The Federal Reserve is widely expected to raise U.S. rates next week, its second increase this year, and some investors think it may hint at four rate hikes in 2018 rather than the three that have been widely anticipated.

ECB policymakers meeting on June 14 will debate whether to end bond purchases this year, the bank's chief economist said this week. His hawkish message sent the euro to a three-week top, hit emerging markets, and spurred demand for safe-haven bonds.

An unprecedented U.S.-North Korea summit scheduled for June 12 in Singapore, with Washington seeking to pressure Pyongyang into abandoning its nuclear weapons program, is giving investors another reason for caution. U.S. dollar rose after a four-day losing streak, while perceived safe-haven currencies such as the yen gained as investors grew cautious.

The dollar index .DXY rose 0.18 percent, with the euro EUR= down 0.24 percent to $1.1769.

The Japanese yen, considered a safe haven, strengthened 0.21 percent versus the greenback at 109.47 per dollar JPY= . Treasury yields were little changed as traders awaited outcome of the summit.

Benchmark 10-year notes US10YT=RR last rose 2/32 in price to yield 2.926 percent, from 2.933 percent late on Thursday.

In the oil market, U.S. crude CLcv1 fell 0.59 percent to $65.56 per barrel and Brent LCOcv1 was last at $76.51, down 1.05 percent.

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http://tmsnrt.rs/2egbfVh Emerging markets in 2018

http://tmsnrt.rs/2ihRugV MSCI All Country Wolrd Index Market Cap

http://tmsnrt.rs/2EmTD6j

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