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Morning Briefing: Trump's new Afghan war; Barcelona suspects in court
August 22, 2017 / 7:19 AM / 2 months ago

Morning Briefing: Trump's new Afghan war; Barcelona suspects in court

LONDON (Reuters) - Donald Trump's declaration of an open-ended "fight to win" the 16-year conflict in Afghanistan will resonate with European allies who will now be asked to step up to the plate in boosting Western troop numbers there.

U.S. President Donald Trump announces his strategy for the war in Afghanistan during an address to the nation from Fort Myer, Virginia, U.S., August 21, 2017. REUTERS/Joshua Roberts

This was the military effort that was wound down from its peak of 2011, when no fewer than 140,000 troops operated under U.S. and NATO command there: Washington now acknowledges the withdrawal was too fast, with local Afghan forces unable to check Taliban insurgents who have gained ground since.

Britain, which was among those European allies that pledged more troops for Afghanistan back in June, has already come out backing Trump's renewed commitment in the country; US Defense Secretary Jim Mattis will now consult with NATO allies to firm up exact numbers.

It will be no solace to those who lost loved ones in Barcelona but Paris should show today how cities bounce back from such attacks. Despite continued warnings of a high terror threat level, figures out from the local tourist sector at 0930 GMT are expected to confirm anecdotal evidence of an increase in visitors to one of the world’s best-loved cities.

In Spain, meanwhile, the four men accused of being members of an Islamist cell behind the Barcelona van attack are in court today, a day after the alleged driver was shot dead by police. The hearing was likely to end in the suspects being remanded in custody while the judge conducts an investigation that could take months or even years before a trial is organised.

Britain's Brexit paper chase continues, with Theresa May's government publishing the third of a batch of five position papers this week on individual points of the negotiations. Today it will be outlining ways to resolve cross-border civil disputes with the European Union after Brexit.

MARKETS AT 0655 GMT

European shares look set to open higher, breaking a three-day losing streak, after notable gains in Asia and the first rise in three sessions on Wall Street.

French soldiers patrol as tourists visit the Notre Dame cathedral in Paris, France August 15, 2017. REUTERS/Pascal Rossignol

The factors that have pushed stocks lower in recent days – worries over whether U.S. President Donald Trump will implement his economic agenda and tensions on the Korean peninsula haven’t got any worse – but this week’s gathering of central bankers in Jackson Hole is likely to limit gains and keep sidelined most of the investors who aren’t on holiday.

European equity investors are looking to the Jackson Hole meeting to provide some fresh direction as the European earnings season rolls to a close. Volumes are thin and volatility remains subdued. Eyes will be on UK subprime lender Provident Financial, which has issued another profit warning – its shares are already down almost 40 percent so far this year, and news that its CEO has left could also weigh.

So far 87 percent of MSCI Europe’s firms have given second quarter updates, of which around 60 percent have either met or beaten analysts’ expectations, according to Thomson Reuters data, with earnings growth for the quarter clocking in at around 24 percent compared with the same period last year.

Stocks movers/company news: BHP to quit U.S. shale business as annual profit surges; Mining firm Antofagasta first-half profits soar on copper price rise; Provident Financial CEO quits, dividend shelved after fresh profit warning; UK builder Persimmon posts 30 pct first-half profit rise; Zurich Insurance looks to pare back HQ staff; Secure Trust Bank's first-half profit jumps on surge in lending; Vienna Airport H1 core profit up 3.9 pct as passenger numbers rise; Wood Group HY profit falls 86.7 percent on exceptional costs.

Metals have been notable winners in recent days, largely on expectations of demand for steel, especially from China. They are slightly off the recent peaks on Tuesday but have helped lift some Asian stock markets.

The dollar is slightly higher against a basket of major currencies with the focus firmly on Jackson Hole. U.S. Federal Reserve Chair Janet Yellen speaks on Friday but her topic is financial stability, so there may not be many new clues on whether the central bank raises rates for a third time this year.

Sources have said European Central Bank President will offer no new policy messages at the meeting. The euro is down 0.2 percent at $1.1794, the yen is down 0.3 percent at 109.30 per dollar and sterling is down 0.2 percent at $1.2875.

Core government bond yields are rising. German 10-year yields are up 1 basis point at 0.41 percent and their U.S. equivalents are up 21 bps at 2.20 percent.

Oil prices are rising. Brent crude, the international benchmark, is up 31 cents at $51.95.

Editing by Andrew Heavens

Our Standards:The Thomson Reuters Trust Principles.
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