Global stock markets drifted toward their best week in six on Friday, August 25, as a near three-year high in emerging markets shares and a roaring rally in metals bolstered the year’s global bull run.
MSCI’s 24-country EM index hit a near three year high on Friday. Asia-Pacific shares .MIAPJ0000PUS ended the week 1.6 percent higher, having shrugged off an overnight dip on Wall Street as a rift between U.S. President Donald Trump and Congress over the country’s debt level rumbled on.
Moves were tight ahead of speeches later by Federal Reserve and European Central Bank heads Janet Yellen and Mario Draghi at one of the highlights of central banking calendar, the Jackson Hole, Wyoming, symposium.
European shares gave up an early push higher though London’s FTSE .FTSE did hold modest gains supported by its heavyweight mining contingent and the pound’s GBP= fourth straight weekly fall. A weaker sterling flatters the appearance internationally-earned profits.
The dollar meanwhile added to its best week against the Japanese yen JPY= in seven as it hovered at 109.64 yen.
The dollar’s strength on the day also grounded the high-flying euro EUR= which has had another strong week and is now at its highest against the pound in eight years barring sterling’s ’flash’ crash last October. EURGDP=
“Our current assessment of the overall risk and reward picture keeps us overweight global equities in our tactical asset allocation,” UBS Wealth Management chief investment officer, Mark Haefele, said in a monthly note.
Emerging markets have been a strong driver of the global stocks rise this year.
In a post on Twitter, Trump said Congress could have avoided a legislative “mess” if it had heeded his advice on raising the amount of money the government can borrow, known as the debt ceiling.
Since 1960, Congress has acted 78 separate times to permanently raise, temporarily extend, or revise the definition of the debt limit -– 49 times under Republican presidents and 29 times under Democrat ones.
But the Trump factor is making markets jittery. His latest tweet came after he said on Tuesday that he would be willing to risk a government shutdown to secure funding for a wall along the U.S.-Mexico border.
