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World Stock Markets Tank Due to Tech Issues and Brexit Snags

World stock markets tanked Wednesday, as hopes faded that a Brexit deal would be wrapped by next week and a revenue warning from Texas Instruments pulled down tech stocks.

It was hard to select which was weighing on sentiment more in early European trading. The pound was pulled down to $1.2850 from $1.30 after UK legislators put the brakes on the government’s Brexit plans again on Tuesday.

In the meantime, Europe’s tech industry dropped by 1.4%. STMicroelectronics, Dialog Semiconductor, and Infineon all dropped after Texas Instruments plunged 10% in after-hours Wall Street trading.

Leading Asian chipmakers, including Taiwan’s TSMC and South Korea’s SK Hynix, had dropped on worries the industry was being squeezed both by a downturn in global demand and by the U.S.-China trade battle.

With buyers seeking out safer belongings again, the Japanese yen rose to a one-week high of 108.25 per greenback, and the Swiss franc gained early in Europe.

Adam Cole, a tactician at RBC Capital Markets, said Brexit was driving a “general risk-off tone”. Others pointed to the rising probability UK Prime Minister Boris Johnson would now lead for a snap election.

The U.K. Sterling has surged 4.5% this month, which, if it holds the gains, might be its best month since January 2018.

Receding worries about a no-deal Brexit also underpinned the euro at $1.1122, just below a two-month high of $1.1180.

The greenback was subdued before a Federal Reserve policy meeting next week, where policymakers are anticipated to pare rates of interest by 0.25% point.

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Angela Maynard

Angela is a Market expert with vast experience in commodities and markets. She also has expertise in marketing. She has worked with several entrepreneurs, financial services firms, and media houses. Angela joined the group in 2018. Now, she is leading the Market column.

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