Trump thumps stocks with more tariffs


New York

Equity trading screens were bathed in red on Friday after US President Donald Trump stunned investors by unveiling new tariffs on China, cranking up trade tensions between the world’s top two economies.
The announcement on Thursday that Washington will impose 10 percent tariffs on another $300 billion in Chinese goods sparked a broad-based sell-off across the globe. All three major Wall Street indices sank to their lowest levels since June, with the S&P 500 and Nasdaq recording their worst weekly losses of 2019.
News that demand for US exports had weakened underscored concern that trade was becoming a trouble spot for economies worldwide. Trump’s announcement means virtually all of the $660 billion in annual merchandise trade between the world’s two biggest economies will be subject to punitive tariffs on it, with the latest duties due to take effect September 1.
The US decision came after trade negotiators held talks in Shanghai this week, the first face-to-face discussions since Trump and Chinese President Xi Jinping agreed to a truce in June. China warned Friday it would take “countermeasures” if the US followed through on its threat, with the commerce ministry calling the decision a “serious violation” of the June truce.
“Trump sent the market into a tailspin,” remarked Alfonso Esparza, senior market analyst at online currency trading platform OANDA. Shaw Cruz at TDAmeritrade told AFP the trade war news had investors fearing a hit to corporate profits later this year. “It can affect the third- and fourth-quarter earnings. It can be expensive for companies to switch up their supply chains,” he said. “It’s not something you can do overnight.”
Hong Kong and Tokyo each lost more than 2.0 percent. Europe’s main markets closed with even bigger losses, as Frankfurt and Paris shed more than 3.0 percent. Investors fleeing stocks favored safe-haven investments such as bonds, pushing the yield on German government 10-year bonds to a new record low of -0.5 percent.
Gold was another beneficiary, climbing to $1,444.92 an ounce in afternoon deals from $1,426.34 a week earlier. Oil prices also recovered some ground after suffering a rout Thursday as Trump’s tariffs announcement fueled concerns about lower demand.Key figures around 2100 GMT – New York – Dow: DOWN 0.4 percent at 26,485.01 (close) New York – S&P 500: DOWN 0.7 percent at 2,932.04 (close) New York – Nasdaq: DOWN 1.3 percent at 8,004.07 (close) London – FTSE 100: DOWN 2.3 percent at 7,407.06 (close) Frankfurt – DAX 30: DOWN 3.1 percent at 11,872.44 (close).—APP

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