Global stock markets were stable Thursday as investors tried to gauge the impact of the sweeping tax reform plan unveiled by U.S. President Donald Trump, while geopolitical tensions surrounding North Korea kept confidence in check.
KEEPING SCORE: Britain’s FTSE 100 was down 0.2 percent at 7,297 while France’s CAC 40 added 0.1 percent to 5,284. Germany’s DAX advanced 0.3 percent to 12,698. Futures augured a lukewarm start on Wall Street. S&P futures and Dow futures both fell 0.1 percent.
U.S. POLITICS WATCH: Trump and congressional Republicans proposed a $5 trillion tax plan on Wednesday, calling it much-needed relief for the middle class and a boost for the economy. The proposal would deeply cut taxes for corporations from the current 35 percent to 25 percent and simplify the tax system, while nearly doubling the standard deduction used by most Americans. The plan was widely expected by investors but with negotiations ahead, the final picture of the tax plan is unclear.
THE QUOTE: “While the impact from the new framework on Asian markets remains debatable with repatriation of offshore earnings one to expect, investors will likely look to the improvement it may bring to U.S. companies and in turn stock market in the near term,” said Jingyi Pan, a market strategist at IG in Singapore.
ASIA’S DAY: Asian markets finished mixed. Japan’s Nikkei rose 0.5 percent to 20,363.11 and Australia’s S&P/ASX 200 added 0.1 percent to 5,670.40. In South Korea, the Kospi finished flat at 2,373.14. But Hong Kong’s Hang Seng index slipped 0.8 percent to 27,421.60 and China’s Shanghai Composite Index fell 0.2 percent to 3,339.64. Stocks in Southeast Asia were mixed.
CHIP DEAL: Asian chipmakers involved in Toshiba’s chip unit sales gained ground after a consortium of companies from Japan, South Korea and the United States disclosed that it will purchase the struggling Japanese tech company’s memory chip business. Shares of South Korean chipmaker SK Hynix Inc., which is part of the consortium that also includes Bain Capital Private Equity and Apple, rose 1 percent. Toshiba Corp.’s stock jumped 2.3 percent.
OIL: Benchmark U.S. crude rose 51 cents to $52.65 per barrel on the New York Mercantile Exchange. The contract added 26 cents to close at $52.14 a barrel on Wednesday. Brent crude, the standard for international oil prices, gained 41 cents to $58.31 per barrel in London.
CURRENCIES: The dollar fell to 112.62 yen from 112.82 yen. The euro rose to $1.1772 from $1.1750.