Global stocks dive on trade war, economic woes

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LONDON/NEW YORK/ MELBOURNE

World stock markets plunged Thursday in a perfect storm as Europe headed to the polls amid fresh economic gloom, the China-US trade war continued to rage, and beleaguered Prime Minister Theresa May delayed another key Brexit vote. Europe kicked off voting across the continent in a contest in which rising populist forces are hoping to make significant gains, threatening closer EU integration.

Britain’s EU poll is an extraordinary spectacle for a country that narrowly decided almost three years ago to leave the bloc and whose leader had vowed to avoid the vote. The markets (are) caught in a perfect storm of UK political turmoil, US-China trade warmongering and European economic softness, said Spreadex analyst Connor Campbell.

London’s FTSE 100 shares index was down 1.5 percent in midday deals as the government postponed a crucial Brexit vote following an outcry from hardline Brexiteers over concessions made by May who faces intense speculation over her future.

The pound forged another four-month low at $1.2606 as May faces being ousted after her revised plan to push through her Brexit agreement, which sparked the resignation of cabinet member Andrea Leadsom.

Eurozone indices took a battering also on Thursday, with Frankfurt and Paris losing 1.8 percent and 1.7 percent respectively in afternoon trading as survey data showed the bloc´s economic growth remained subdued in May. The last thing the market needed on Thursday was a reminder of the Eurozone’s manufacturing and services sector woes, added Campbell. For the region as a whole, the former fell even further into contraction territory. — VoM

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