Friday, 7 December 2018

Markets fall after arrest of Huawei CFO, “bottom isn’t in sight”

Markets fell on Thursday.

The S&P 500 fell 0.2 percent, the STOXX Europe 600 plunged 3.1 percent and the Nikkei 225 tumbled 1.9 percent.

Stocks fell on news that Canadian authorities had arrested Meng Wanzhou, the chief financial officer of Huawei Technologies, at the request of US authorities for allegedly violating sanctions against Iran.

However, US stocks rebounded in the afternoon after a report that the Fed may consider a pause after raising interest rates later this month.

Jasper Lawler, head of research at London Capital Group, wrote in a note that the arrest of Meng “has the potential to shatter very fragile U.S.-Sino relations which will weigh further on global trade and growth concerns”, and that “despite recent heavy selloffs, the bottom isn’t in sight and the markets have further to fall”.

Similarly, Art Cashin, UBS director of floor operations at the NYSE, said on CNBC that if stocks “slide through here, then you're going to look to test much deeper lows”.

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