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Trump-Xi meeting jitters move markets

The near hysteria of trying to anticipate the outcome of the meeting between President Trump and his Chinese counterpart Xi Jingpin this weekend is now permeating equity trading; it moved Asian markets significantly higher overnight and is to a lesser extent propping up European gauges. 

US media is quoting Washington sources saying that the two presidents will negotiate a six months truce in order to avoid the damaging impact of the trade dispute on both economies. However, in an interview on US television Trump said that if the trade deal doesn’t come to fruition he would collect billions of dollars in tariffs from China and simply do less business with the country. 

In London Kingfisher is leading the gainers after it appointed an experienced Carrefour executive as its new CEO while property companies are providing a counterweight to the rally. 

Dollar rallies on deal expectations 

The dollar rallied against the yen on the assumption that the two sides would reach some sort of agreement this Saturday in Japan but the currency traded flat against the euro and the Canadian dollar. The focus now is shifting onto US jobless data and GDP numbers due later this morning which will provide an insight into whether the Fed will be able to keep rates flat at its next meeting, as some members suggested earlier this week. 

The pound was barely showing any signs of life, trading almost unchanged against the euro and the dollar, cautious as Boris Johnson keeps reiterating his Brexit at any cost approach. 

Profit taking pushes Brent crude lower

Investors took some profits off the table, cashing in after the swift rise in Brent crude prices over the last few days which saw oil rise by 2% on Wednesday, having already made gains Monday and Tuesday. 

This morning Brent is trading down 0.87% but is still comfortably above $65, the highest level in almost a month, supported by ongoing tensions in the Middle East and expectations that OPEC will extend its production cuts when it meets in Vienna next week.

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