Issue link: https://maltatoday.uberflip.com/i/1171482
26.09.19 8 NEWS COUNTDOWN TO BREXIT 35 DAYS TO GO WORLD stocks fell to a two-week low and risk assets withered on Wednesday after U.S. lawmakers called for an im- peachment inquiry into President Don- ald Trump, raising the prospects of pro- longed political uncertainty amid a fresh rise in trade tensions. Adding to geopolitical tensions was heightened uncertainty over Britain's de- parture from the European Union after the Supreme Court ruled Prime Minister Boris Johnson had unlawfully suspended parliament. e pound fell about 1% in its biggest daily decline since the end of July. e move by Democrats in the U.S. House of Representatives to impeach Trump has exacerbated market anxie- ties over global recession risks and the U.S.-China trade dispute. Trump deliv- ered rebuked China for its trade practices in a speech on Tuesday. MSCI's global stock index .MIWD- 00000PUS dropped 0.4% in a fourth straight day in the red - the longest losing streak since a rout at the end of July. e pan-European STOXX 600 .SXPP dropped 1.4%, led by technology stocks .SX8P. [.EU] France's CAC .FCHI tum- bled 1.5%; export-reliant Germany .GD- AXI fell 1.2%. "It is hard to imagine how long can the truce with China remain on trade and that is adding to the general cautious en- vironment for stocks," said Neil Mellor at BNY Mellon in London. "As soon as mar- kets start worrying about trade, they look at central banks for help, but there is in- creasing pushback from them, too." e downturn in Europe followed de- clines in Asia. Tokyo's Nikkei .N225 suf- fered its largest loss in three weeks. China .SSEC and Hong Kong .HIS dropped 1% or more. China's offshore yuan weakened, many other emerging-market currencies weak- ened and oil futures extended their de- clines. e downturn looked to continue in the United States, with U.S. stock futures ESc1 indicating a 0.2% decline at open. e impeachment inquiry and disap- pointing U.S. economic data had knocked Wall Street on Tuesday, sending the S&P 500 .SPX 0.84% lower, its biggest daily de- cline in a month. e U.S. House of Representatives will begin a formal impeachment inquiry over whether Trump sought help from the Ukraine to smear former Vice President Joe Biden, a front-runner for the 2020 Democratic presidential nomination. It is unlikely that the inquiry will lead to Trump's removal from office. Even if the Democratic-controlled House voted to impeach Trump, he would then be tried in the Senate, where Republicans hold the majority and are unlikely to convict him. "Despite the drama this process will inject into the rest of the President's first term, there is little justification for al- tering asset allocation now, unless one thinks that this issue is the decisive one that tips the U.S. economy into sub-trend growth and/or a profits recession," said JPMorgan's head of cross-asset funda- mental strategy, John Normand. Pretty remarkable Markets have already been roiled by po- litical disquiet in Hong Kong from Britain to Italy and the Middle East, with the lat- est developments prompting investors to ditch riskier assets and flock back to safe havens. e dollar index .DXY, measuring the U.S. currency against a basket of six oth- er major currencies, nudged 0.3% higher. e safe-haven Swiss franc edged up 0.2% against the euro to 1.0845 francs EU- RCHF=EBS. Sterling dropped 1% to $1.2377 GBP=, more than reversing its gains from Tues- day when Britain's Supreme Court ruled Johnson had unlawfully suspended par- liament. Johnson vowed Britain would leave the EU by an Oct. 31 deadline come what may, but he now faces reinvigorated opposition to his plans. Britain's FTSE in- dex .FTSE dropped 0.8%. "Predicting the ultimate outcome of Brexit remains difficult," said Mark Haefe- le, chief investment officer at UBS glob- al wealth management. "As a result, the longer-term risk-return outlook for UK equities looks uncertain. We still advise being nimble on sterling." e move to safe havens also saw euro zone government bond yields slip lower. Yields on sovereign debt across the bloc plunged this week, with many at their lowest since Sept. 12, when the Europe- an Central Bank announced a new wave of stimulus measures to boost economic growth and inflation. Trump impeachment move knocks stocks, Brexit rattles pound The London Stock Exchange Group offices are seen in the City of London, Britain