Global Stocks Tumble Due to US-China Trade War

Ann Santiago
Мая 16, 2019

Although the new tariffs were highly anticipated, USA stocks sold off sharply as investors sorted out the details.

The Dow Jones Industrial Average dove 617.38 points, or 2.4%, to 25,324.99. But he also softened his tone on soybeans and other agricultural products, appealing to Beijing to act.

Increasingly, however, it is looking like Trump's tariffs are here to stay and more tangible than any of the deals the president has promised.

Just a few hours before, China said it would impose higher tariffs on $60bn of American goods in response to an earlier set of USA levies. Apple (NASDAQ:), which counts China as a major market, fell 5.8%.

Those hopes are now being dashed and replaced by concerns that the trade war could crimp what is otherwise a mostly healthy economy.

Asian markets fell broadly. The Nasdaq composite rose 0.7%. The index fell 2.4% the day before.

"You never really know, right?" But "this is more of a re-evaluation of stocks than it is a pure panic".

Tuesday's rally saw such worries easing.

The yield on 10-year Treasuries fell four basis points to 2.37%, the lowest in seven weeks. The gains at Dow Hones were bolstered by Visa and Boeing shares and the 30-stock index got the best day on Tuesday since April 12. In tweets and other public utterances in recent days Trump has repeatedly hailed his tariffs, claiming they have helped power U.S. economic growth and repeated over and over again that other countries such as China pay the bill, a view even his own economic advisers are uncomfortable defending. Trump also said that China had a "great deal" nearly completed but they "backed out".

"The fact that Trump is considering slapping tariffs on a further US$300-billion of Chinese imports is keeping investors jittery", said Jasper Lawler, London Capital Group's head of research.

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The Dow is up 2,204.59 points, or 9.4%.

"Such an inversion of the curve has often been accompanied, or followed, by a downturn in the US economy and stock market", Mr. Higgins said.

"Some consolidation was to be expected, given the phenomenal start of the year", for markets, Eric Wiegand, senior portfolio manager at U.S. Bank, told MarketWatch, adding that the recent U.S.

Some of those losses were mitigated on Friday after stocks staged a massive comeback, however.

In a note to clients Monday, Citi said its China economists are "cautiously optimistic that a trade deal can eventually be signed".

Trump is preparing to impose higher tariffs on $325 billion worth of Chinese goods. Plus, there could be more retaliation from China - last time farmers took a big hit.

"The odds of a China-U.S. trade accord remain significant, even though tariffs are being raised", he added. Kudlow said the chances of such as meeting "were pretty good" but added that there are "no concrete, definite plans" for when US and Chinese negotiators will meet again. This article is strictly for informational purposes only. It is not investment advice or a solution to buy or sell securities.

"However, differences on key issues and in negotiating styles may spark more market volatility ahead".

He has also threatened more to come with a May 18 deadline looming for him to make a decision on whether to proceed with new tariffs on imported cars and parts.

On Wall Street, tech stocks led the way higher Tuesday after suffering a beating the previous day. Others are looking for cheap stocks that can hold up if economic growth slows in the coming months.

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