20 February 2019
Wall Street traders react as stocks take a beating from civil unrest in Hong Kong. Photo: Reuters
Wall Street traders react as stocks take a beating from civil unrest in Hong Kong. Photo: Reuters

Global stocks fall, bonds rise on Hong Kong unrest

Hong Kong protests weighed on investor sentiment, driving down global equity markets overnight.

United States Treasury debt rose over uncertainty sparked by the unrest, Reuters reported Tuesday.

On Wall Street, stocks opened sharply lower following declines in Europe and Asia after Hong Kong democracy protesters defied tear gas and police baton charges.

Shares of companies exposed to Hong Kong fell, including HSBC and luxury goods group Richemont. HSBC closed down 2.3 percent and Richemont fell 1.7 percent.

Emerging markets took a hit. MSCI’s emerging markets index fell 1.45 percent, with Brazilian shares a big drag.

The Dow Jones industrial average closed down 41.93 points, or 0.25 percent, at 17,071.22. The S&P 500 fell 5.05 points, or 0.25 percent, to 1,977.8 and the Nasdaq Composite shed 6.34 points, or 0.14 percent, to 4,505.85.

MSCI’s all-country world index was down 0.45 percent, while the FTSEurofirst 300 index of leading European shares closed down 0.43 percent at 1,371.11.

Benchmark 10-year US Treasury notes gained to yield 2.4943 percent.

Uncertainty around the protest in Hong Kong was seen as one driver of demand for bonds. Month-end buying added to demand, while some gains were also seen as giving back weakness from Friday over fears that bond behemoth Pimco would have to sell assets after the departure of co-founder Bill Gross, the report said.

The US dollar erased early gains against the yen on concerns the protests in Hong Kong might hurt the local economy and the city’s status as a global financial hub. Investors often seek the safe haven of the Japanese currency during times of uncertainty.

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