* Oil up on trade hopes, military action in Syria
* Turkish lira touches four-month low versus USD
(Updates prices, changes comments, dateline; previous LONDON)
By Rodrigo Campos
NEW YORK, Oct 9 (Reuters) - Stocks gained on Wednesday on a
report that China could yet agree to a partial trade deal with
the United States despite recent tensions, while the prospect of
a last-minute Brexit agreement between the European Union and
Britain seemed as remote as ever.
Sterling was little changed against the dollar after losing
nearly 1% over the past two sessions, while oil prices rose on
trade optimism and after Turkey launched a military operation https://www.reuters.com/article/us-syria-security-turkey-erdogan/turkey-launches-operation-into-northeast-syria-erdogan-idUSKBN1WO1MS
in northern Syria.
China is still open to agreeing to a partial trade deal,
Bloomberg reported on Wednesday, despite the recent U.S.
blacklisting of Chinese technology firms and reports on visa
restrictions from both sides. "You don't want to ignore headlines, but at the same time
each headline seems to say the same thing - that both sides want
to see something happen and both sides are encouraged that
something may happen," said Michael Lorizio, senior fixed income
trader at Manulife Investment Management in Boston.
Markets have been wobbly this month on more evidence that
the U.S.-China conflict over trade is increasingly damaging the
global economy. Stocks have been particularly sensitive to
headlines regarding trade.
"There are expectations that some sort of an interim deal
will emerge from these meetings," said Peter Cardillo, chief
market economist at Spartan Capital Securities in New York.
"Investors certainly seem more hopeful now than they did two
days ago."
On Wall Street, the Dow Jones Industrial Average .DJI rose
146.5 points, or 0.56%, to 26,310.54, the S&P 500 .SPX gained
20.08 points, or 0.69%, to 2,913.14 and the Nasdaq Composite
.IXIC added 65.51 points, or 0.84%, to 7,889.29.
The pan-European STOXX 600 index .STOXX rose 0.40% and
MSCI's gauge of stocks across the globe .MIWD00000PUS gained
0.39%.
Emerging market stocks lost 0.17%. MSCI's broadest index of
Asia-Pacific shares outside Japan .MIAPJ0000PUS closed 0.45%
lower, while Japan's Nikkei .N225 lost 0.61%.
BREXIT TALKS
Meanwhile, talks between the European Union and Britain over
an agreement to cover London's departure from the EU on Oct. 31
appeared to be going nowhere. British lawmakers have voted to force Prime Minister Boris
Johnson to seek an extension to the departure date if he cannot
agree a deal, but the prospect of further prolonged political
uncertainty is worrying investors.
The pound initially jumped after a British newspaper report
said the EU would make a major concession in the negotiations,
but the gains were quickly unwound as EU sources denied it.
Sterling GBP= was recently at $1.2217, flat on the day.
The dollar index .DXY fell 0.07%, with the euro EUR= up
0.21% to $1.0977.
The Japanese yen weakened 0.28% versus the greenback at
107.40 per dollar.
The Turkish lira touched a near four-month low versus the
dollar after Ankara launched a military operation against
Kurdish fighters in northeast Syria just days after U.S. troops
pulled back from the area. The Turkish currency lost 0.47% versus the dollar at 5.86.
In bond markets, U.S. Treasury US10YT=RR and euro zone
government bond yields DE10YT=RR ticked higher as investors
happy to take on some more risk sold out of safer assets. A
flood of supply also weighed on U.S. bond prices.
Benchmark 10-year notes US10YT=RR last fell 8/32 in price
to yield 1.5648%, from 1.539% late on Tuesday.
Ecuadorian bonds tumbled as protesters began a national
strike after President Lenin Moreno refused to step down or
overturn anti-austerity measures that have triggered the worst
unrest in a decade. Oil prices jumped as traders bet any easing of the
U.S.-China tensions would benefit global demand. O/R
U.S. crude CLc1 rose 1.98% to $53.67 per barrel and Brent
LCOc1 was last at $59.25, up 1.73% on the day.
"Crude oil has, just like other riskier assets, received a
boost from news that China is open to accept a partial trade
deal," Saxo Bank commodity strategist Ole Hansen said.
"This news comes on top of earlier reports that Turkish
troops have moved into Iraq - something that could add to a
growing list of geopolitical worries for the oil market."
Spot gold XAU= added 0.1% to $1,507.10 an ounce. U.S. gold
futures GCc1 gained 0.58% to $1,512.60 an ounce.
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Global assets in 2019 http://tmsnrt.rs/2jvdmXl
Global currencies vs. dollar http://tmsnrt.rs/2egbfVh
Emerging markets in 2019 http://tmsnrt.rs/2ihRugV
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