NEW YORK (Reuters) - Global stocks ended August much as they began the month - under the dark cloud of a potentially worsening trade war.
Traders work on the floor of the New York Stock Exchange (NYSE) in New York, U.S., August 31, 2018. REUTERS/Brendan McDermid
A closely watched barometer of equities worldwide fell for a second day on Friday after the United States and Canada failed to reach a trade deal and a report that U.S. President Donald Trump was preparing to step up a trade war with Beijing. The news dampened risk appetite and erased some gains from a rally this week.
“It’s very hard to see a decisive resuscitation of risk appetite until these tensions are resolved,” said Paul O’Connor, head of the multi-asset team at Janus Henderson Investors.
“We have learned to under-react to some of the individual headlines because if you try to extrapolate from any of them you could find yourself in big trouble.”
The MSCI All-Country World Index .MIWD00000PUS, which measures stocks in 47 countries, shed 0.34 percent for the day, but eked out a 0.7 percent return for the month, including dividends.
The index’s modest rise masked a chasm between U.S. and emerging markets. The S&P 500, which includes large U.S. companies, is up nearly 3 percent for the month, while the MSCI Emerging Markets index .MSCIEF is down by roughly the same margin.
On Friday the Dow Jones Industrial Average .DJI fell 22.1 points, or 0.09 percent, to 25,964.82, the S&P 500 .SPX gained 0.39 points, or 0.01 percent, to 2,901.52 and the Nasdaq Composite .IXIC added 21.17 points, or 0.26 percent, to 8,109.54. [.N]
Canada and the United States failed to reach a deal on Friday to
