A worker checks the floor near the screen showing the Korea Composite Stock Price Index (KOSPI) at the Korea Exchange in Seoul, South Korea, Monday, Jan. 14, 2019. Shares were lower in Asia on Monday, extending the latest losses on Wall Street, as China reported a slowdown in exports. (AP Photo/Lee Jin-man)

World shares sink after China reports slowdown in exports

January 14, 2019 - 8:29 am

LONDON (AP) — Stock markets around the world drifted lower Monday after China reported a slowdown in exports dented the recent upturn in confidence. The British pound was steady ahead of a tumultuous week in British politics with lawmakers expected to vote against Prime Minister Theresa May's Brexit deal.

KEEPING SCORE: In Europe, Germany's DAX was down 0.5 percent at 10,835 while the CAC 40 in France fell 0.7 percent to 4,750. The FTSE 100 in Britain declined 0.9 percent to 6,859. Wall Street looked set for a downbeat start to the week with Dow futures and the broader S&P 500 futures down 0.8 percent.

CHINA TRADE: China said Monday that its exports to the U.S. contracted in December although its overall trade surplus with the U.S. hit a record $323 billion in 2018. Exports to the U.S. rose 11.3 percent to $478.4 billion for the year despite punitive tariffs imposed by President Donald Trump in a fight over Chinese technology ambitions. The customs data showed imports of American goods rose just 0.7 percent over 2017, reflecting the impact of Beijing's retaliatory tariffs and encouragement to importers to buy more from non-U.S. suppliers.

ANALYST TAKE: "The release of Chinese trade data has done little to help sentiment around both the Chinese growth story, and prospects of talks between the U.S. and China," said Joshua Mahony, senior market analyst at IG.

BREXIT: Britain's exit from the European Union comes to a crunch this Tuesday when lawmakers vote on Prime Minister Theresa May's Brexit deal with the bloc. All indications are that she will lose the vote heavily. What happens next is unclear. Some lawmakers are arguing that the country should reconsider its decision to leave the bloc, possibly by another referendum. Others think that the country would be better off to crash out of the bloc on March 29, when Brexit is officially due to take place. Whatever emerges over the coming few days, it's likely to be volatile for U.K. markets, particularly the pound, which is trading steadily on Monday, up 0.1 percent at $1.2848. "The pound will remain extremely sensitive to Brexit news over the next 48 hours," said Neil Wilson, chief market analyst at Markets.com.

THE DAY IN ASIA: Hong Kong's Hang Seng index lost 1.4 percent to 26,298.33 while the Shanghai Composite fell 0.7 percent to 2,535.77. The Kospi in South Korea declined 0.5 percent to 2,064.52 and Australia's S&P ASX 200 was flat at 5,773.40.

ENERGY: Benchmark U.S. crude oil gave up 69 cents to $50.90 per barrel in electronic trading on the New York Mercantile Exchange, while Brent crude, the international standard, fell 73 cents to $59.75 per barrel.

CURRENCIES: The euro was 0.1 percent lower at $1.1461 while the dollar 0.3 percent 108.11 yen.

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