LONDON - World stocks struggled and safe haven bets were back in play on Friday with German bond yields plumbing record lows as Chinese data rekindled woes about the health of the global economy and fears of a new U.S.-Iran confrontation intensified.
Expectations for more stimulus in China are growing as the Sino-U.S. trade dispute threatens to escalate into a full-blown trade war that many fear could push the global economy into recession. “The sales warning from Broadcom is also weighing on markets this morning as it suggests that both semiconductor and auto sectors are under pressure worldwide,” said Christophe Barraud, chief strategist at brokerage Market Securities in Paris, adding that expectations for a rebound were now shifting from the second half of this year to 2020.U.S. stock futures indicated Wall Street was in line for a lower open, with the S&P e-mini pointing to a 0.2% fall.
“There is a large degree of uncertainty going into next week’s FOMC meeting as market reaction will differ significantly depending on whether the Fed hints toward easing policy,” said Shusuke Yamada, chief Japan FX and equity strategist at Bank Of America Merrill Lynch.Growing worries about a new U.S.-Iranian confrontation after two attacks on two oil tankers in the Gulf of Oman on Thursday added to the unhappy mood.