Record high stocks pause to gauge Sino-US trade outlook, company earnings

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World stocks eased off record highs on Wednesday and U.S. and German bond yields slipped as euphoria over a Sino-U.S. trade deal was depleted by U.S.

The 18-month long trade spat should enter a quieter phase as U.S. President Donald Trump and Chinese Vice Premier Liu He sign an initial agreement that would boost Chinese purchases of U.S. manufactured and agricultural goods, energy and services.Dubbed the Phase 1 deal, it may soothe markets which have been on edge as the conflict between the world's two largest economies hit hundreds of billions of dollars in goods, uprooted supply chains and slowed economic growth.

The jittery mood gave a mild boost to safe-haven assets such as gold, with the precious metal ticking up 0.3per cent after two days of losses. The Japanese yen and high-grade bonds also firmed slightly, though the yen was only 0.1per cent higher versus the dollar and a whisker off 7-1/2-month lows of 110.22.

Markets are also weighing the potential impact of the U.S. government nearing publication of a rule to vastly expand its powers to block shipments of foreign-made goods to China's Huawei, as it seeks to squeeze the blacklisted telecoms firm. Big banks Goldman Sachs, Bank of America, BlackRock are among those reporting results later on Wednesday and expectations are high after JPMorgan posted record profits and Citi beat estimates, though Wells Fargo profits slumped.

 

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