LONDON (AP) — Global stocks were lackluster Friday, particularly in Japan, as investors were confronted by a wide array of geopolitical issues, including President Barack Obama’s decision to authorize airstrikes in northern Iraq, and the Ebola outbreak in western Africa.
KEEPING SCORE: In Europe, Germany’s DAX was down 0.2 percent while the FTSE 100 index of leading British shares fell 0.3 percent. France’s CAC-40 was also 0.3 percent lower. Futures markets indicated flat opening on Wall Street with both the Dow and the broader S&P 500 expected to open 0.1 percent higher.
GEOPOLITICS: As well as monitoring traditional economic indicators, investors have a huge array of geopolitical issues to contend with, including ongoing tensions in Ukraine and Gaza, where a three-day cease-fire came to an end. In addition to those two long-standing sources of concern, investors are having to monitor developments in Iraq in the wake of Obama’s decision to authorize airdrops of humanitarian aid and airstrikes in northern Iraq to counter advancing Sunni radical militants. And the World Health Organization on Friday declared the Ebola outbreak in West Africa to be an international public health emergency that requires an extraordinary response to stop its spread.
ANALYST TAKE: With so much going on around the world, investors, unsurprisingly, aren’t in the mood for too much stock buying. “A red end to another red week looks firmly entrenched for equities,” said Will Hedden, premium client manager at IG. “The weekend will feel like a long time for potential bad news to fester after many geopolitical events have come to a head all at the same time.”
ASIA’S DAY: Those issues really weighed on trading in Asia earlier, notably in Tokyo where the Nikkei 225 slid 3 percent to 14,778.37 as the yen strengthened - the Japanese currency often gets bid up in times of geopolitical risk and that’s not good news for the country’s exporters. Elsewhere, South Korea’s Kospi lost 1.1 percent to 2,031.10 and Hong Kong’s Hang Seng shed 0.2 percent to 24,331.41. In mainland China, the Shanghai Composite Index climbed 0.3 percent to 2,194.42.
IT’S NOT JUST STOCKS: All financial assets are being impacted by the various sources of geopolitical risk, notably the price of gold, through its status as a safe haven for investors looking to park their cash. The precious metal was up 0.5 percent at $1,318 an ounce. The benchmark New York crude oil rate was also higher, trading up 73 cents at $98.07 a barrel.
CURRENCIES: The euro rose to $1.3393 from $1.3361 in late trading Thursday. The dollar fell to 101.78 yen from 102.11 yen.