Trade war: China-US talks to resume amid threat of new tariffs

Ann Santiago
Мая 11, 2019

Trump threatened to raise the 10% tariffs, or taxes, to 25%, on about half of goods imported from China.

In a bright spot, Tapestry Inc shares jumped 8.5 per cent, the most among S&P companies, after the Coach handbag maker beat quarterly profit estimates and announced a US$1 billion share buyback plan.

The President, who has frequently expressed optimism about progress in the months-long talks, renewed his tariff threats after a briefing late last week in which advisers told him the Chinese were reneging on key elements of a potential deal.

Market strategists at Goldman Sachs appear to agree with Divney's approach, should trade talks break down.

Trump also said that paperwork had been initiated to levy 25 per cent tariffs on a further US$325 billion worth of Chinese goods.

"I think it'll be a very strong day", Trump said.

The sudden rupture has roiled global stock markets this week, inflaming anxieties among exporters, markets and industries that had been lulled into optimism in recent months as both sides steadily announced progress in their efforts to end the trade war Trump started previous year.

For 40 years, US leaders have prioritized deepening economic ties between the two countries rather than confront China over its trade practices.

These competing historical narratives are shaping negotiators' strategies and explain why - after anticipating an agreement as soon as the end of this week - the two sides instead find themselves deadlocked.

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A protracted trade war between the United States and China would damage the world economy, disrupt supply chains and rattle investors already nervous over a global slowdown.

"We've gotten an indication that they want to make a deal, our teams are in continued negotiations", Sanders said. It has targeted U.S. goods ranging from chemicals, to vegetables and whiskey.

US officials are insisting that any deal be strictly enforced so that China lives up to its promises - something they say Beijing has repeatedly failed to do in the past.

Gao did not answer directly when asked if China would consider imposing tariffs on imported USA services.

"The market right now is pricing in the assumption that a deal is going to be done", said Jeff Zipper, managing director at U.S. Bank Private Wealth Management.

The S&P 500 index fell 4.63 points, or 0.2%, to 2,879.42.

While China's overall economic growth has remained steady so far this year, the outlook for exporters has been challenging. Gordan Chang, author of "The Coming Collapse of China", told Yahoo Finance Tuesday that in this case, "China has more to lose". If not, the cost of flooring products imported from China will increase by more than 10% starting Friday. "Once again, the two countries, and indeed, the entire world's economy will be forced into a crisis mode that will likely inflict enormous losses on many individual companies and many thousands of workers and farmers in both countries".

In its second straight fall of the week, the Shanghai Composite Index fell 1.48% to 2,850.95 on May 9, close to the day's low and its lowest point in 11 weeks.

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