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Global stocks extend losses after U.S. trade rep comments; oil jumps



NEW YORK (Reuters) – Global stock indexes fell on Wednesday after U.S. Trade Representative Robert Lighthizer said it was too early to predict an outcome in U.S.-China trade talks, while oil prices rallied after inventory data.

FILE PHOTO: The German share price index DAX graph is pictured at the stock exchange in Frankfurt, Germany, February 26, 2019. REUTERS/Staff

U.S. stocks added to losses following his comments. Lighthizer also said that U.S. issues with China are “too serious” to be resolved with promises from Beijing.

U.S. Treasuries prices trimmed losses and the dollar briefly strengthened against the euro after the comments.

Hopes of a resolution to the trade conflict had bolstered stocks in recent sessions. U.S. President Donald Trump said on Sunday he would delay an increase in U.S. tariffs on Chinese goods after “productive” trade talks.

“The general consensus is talks are progressing but it may not be full speed ahead,” said Bucky Hellwig, senior vice president at BB&T Wealth Management in Birmingham, Alabama.

Equity markets also were pressured by technology stocks as the second U.S.-North Korean nuclear summit kicked off and tensions flared up between nuclear-armed neighbors India and Pakistan.

The Dow Jones Industrial Average fell 128.61 points, or 0.49 percent, to 25,929.37, the S&P 500 lost 9.31 points, or 0.33 percent, to 2,784.59 and the Nasdaq Composite dropped 29.64 points, or 0.39 percent, to 7,519.65.

The pan-European STOXX 600 index lost 0.40 percent and MSCI’s gauge of stocks across the globe shed 0.24 percent.

India and Pakistan both said they shot down each other’s fighter jets on Wednesday, a day after Indian warplanes struck inside Pakistan for the first time since a 1971 war, prompting world powers to urge restraint.

India’s and Pakistan’s bonds and currencies fell and MSCI’s broadest index of Asia-Pacific shares outside Japan was down 0.13 percent as the threat of conflict between the nuclear-armed neighbors grew.

Federal Reserve Chairman Jerome Powell, on the second day of his two-day appearance in the U.S. Congress, emphasized patience on raising U.S. interest rates.

Benchmark 10-year Treasury notes last fell 14/32 in price to yield 2.6843 percent, from 2.636 percent late on Tuesday.

The dollar index rose 0.06 percent, with the euro down 0.11 percent to $1.1372. [

Investors were also watching the U.S.-North Korean summit in Hanoi. U.S. President Donald Trump is meeting Kim Jong Un for a second summit, with the United States pushing North Korea’s leader to dismantle its nuclear weapons program.

In commodities markets, oil rallied for a second day after an unexpected decline in U.S. crude inventories and after Saudi Arabia appeared undaunted by pressure from Trump on OPEC to prevent steeper price rises.

Brent crude futures rose to $65.92 a barrel, while U.S. crude rose 3.23 percent to $57.29 per barrel.

Additional reporting by Shreyashi Sanyal in Bengaluru; Amanda Cooper, Julien Ponthus and Tom Finn in London, Daniel Leussink and Tomo Uetake in Tokyo; editing by Larry King, Alexander Smith and Dan Grebler