World stocks stall as China condemns US support for Hong Kong

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A new US law supporting Hong Kong hurt the upbeat mood over trade talks; the pound gained after a poll showed Conservatives well ahead

London — A four-day rally that had lifted world stocks to near-record highs stalled on Thursday as a US bill backing Hong Kong’s protesters became law, provoking China’s ire and threatening to derail an interim trade deal between Washington and Beijing.

“The risk-off moves clearly reflect a concern that this could be an impediment to the phase-one trade deal, which is now widely expected,” said Adam Cole, a strategist at RBC Capital Markets. “People don’t want to be caught on the wrong side,” said Geoff Yu, head of the UK investment office at UBS Wealth Management. “It does reflect there’s cash on the sidelines. If you can stretch the positive narrative, if the trade issue is out of the way for the time being, we might actually see demand pick up.”

 

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