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The Tuesday Market Minute

  • Global stocks mixed as investors eye this week's round of U.S. China trade talks as the March 2 deadline looms.
  • President Donald Trump says talks have made "a lot of progress", but analysts note key issues such as intellectual property protection and forced technology transfers remain sticking points.
  • European stocks drift lower amid a modestly stronger euro and concerns the U.S. could impose tariffs on regionally-produced cars under a national security remit.
  • U.S. equity futures point to only modest declines Tuesday ahead of quarterly earnings from Walmart February housing market index data.

Market Snapshot

Global stocks were mixed in early Tuesday trading, with investors eyeing a key round of trade talks between the U.S. and China later today in Washington for any clues as to whether the two sides can reach an agreement in the final two weeks before a self-imposed deadline wold trigger fresh tariffs between the world's two biggest economies.

U.S. Trade Representative Robert Lighthizer will lead this week's negotiations, with China's Vice Premier Liu He expected to arrive in the nation's capital Thursday and Friday following a successful round of talks last week in Beijing. Should the March 2 deadline pass without a deal, the U.S. is set to lift tariffs on $200 billion worth of China-made goods to 25% from 10%, while China has vowed to react in kind. 

President Donald Trump, however, has hinted that he may extend the talks for a further period of time in order to address the myriad issues that still separate the world's two biggest economies.

"We're making a lot of progress," President Trump told his supporters during a rally in Florida Monday. "Nobody expected this was going to be happening."

The MSCI Asia ex-Japan index was marked 0.15% lower heading into the final hours of trading after the broadest measure of regional share prices tested four-month highs earlier in the session while Japan's Nikkei 225 added 0.1% to close at a fresh two-month high if 21,302.65 points.

Early indications from U.S. equity futures suggest only modest moves on Wall Street Tuesday as investors return from yesterday's President's Day break, with contracts tied to the Dow Jones Industrial Average marked 83 points lower while those lined to the S&P 500 indicate a 6 point dip for the broader benchmark.

European stocks, however, were weaker at the start of trading, with the Stoxx 600 benchmark falling 0.6% by mid-day and bourses around the region drifted into the red.

The Stoxx 600 Automobiles and Parts index was marked 0.8% lower at 479.26 points amid concern that the White House may opt to impose tariffs on European-made cars now that President Trump has received a report from the Commerce Department that assessed their risk to national security. The President will have 90 days to review the report and make a decision.

HSBC Holdings Plc (HSBC) shares traded near the bottom of the London market Tuesday after Europe's biggest bank posted a small-than-expected 2018 profit and cautioned on a slowdown in key markets in Britain and China.

HSBC shares were marked 4.12% lower by mid-day of trading in London to change hands at 636.3 pence each, a move that takes the stock's three month decline to around 2% and values the London-based bank at around £128 billion ($165.3 billion).

Global oil prices were little-changed in early Tuesday trading, although Brent crude remains near the highest levels in three months as the impact of OPEC+ production cuts and U.S. sanctions on the sale of Venezuelan oil continues to offset both record American production rates and concern for a global slowdown in energy demand.

Brent crude contracts for April delivery, the global benchmark, were marked 14 cents lower from their Monday close in New York and changing hands at $66.36 per barrel in a move that trims gains from the December 24 trough to around 25%.

WTI contracts for March delivery -- which closed at the lowest level in two weeks earlier this week -- were seen 11 cents higher at $56.17 per barrel.