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Trade war: Stocks slide as Trump says 'no deadline' for China deal - business live Trade war: Stocks slide as Trump says 'no deadline' for China deal - business live
(32 minutes later)
US president alarms investors by hinting that a China trade deal could wait until after the 2020 electionUS president alarms investors by hinting that a China trade deal could wait until after the 2020 election
A EU delegation to the US says it will seek “immediate talks” on how to resolve the dispute over France’s digital service tax, Reuters reports.
If you missed it earlier, here’s a video clip of Donald Trump criticising France’s new levy on the revenues of US technology giants:
The Paris stock market is also suffering a dose of tariff blues.The Paris stock market is also suffering a dose of tariff blues.
The CAC 40 index is down 1%, with consumer companies and factories suffering the biggest losses.The CAC 40 index is down 1%, with consumer companies and factories suffering the biggest losses.
Luxury goods firm Kering is down 2.3%, with LVMH (Moët Hennessy – Louis Vuitton) losing 2%. As explained earlier, they’re in the firing line from higher tariffs on handbags and champagne.Luxury goods firm Kering is down 2.3%, with LVMH (Moët Hennessy – Louis Vuitton) losing 2%. As explained earlier, they’re in the firing line from higher tariffs on handbags and champagne.
The US stock market is also heading for sharper losses in an hour’s time:The US stock market is also heading for sharper losses in an hour’s time:
Just in: Britain’s FTSE 100 index of top shares has hit its lowest level since late October.Just in: Britain’s FTSE 100 index of top shares has hit its lowest level since late October.
The Footsie has now lost 108 points to 7,177, its weakest level in six weeks.The Footsie has now lost 108 points to 7,177, its weakest level in six weeks.
Donald Trump’s latest trade war escalation is causing alarm in the City, as traders fear that a deal with China could be a year away. The new tariffs being threatened on France have also raised worries that UK-EU relations could worsen.Donald Trump’s latest trade war escalation is causing alarm in the City, as traders fear that a deal with China could be a year away. The new tariffs being threatened on France have also raised worries that UK-EU relations could worsen.
Separately, the the rise in the pound is hurting multinationals - whose overseas earnings become less valuable in sterling terms.Separately, the the rise in the pound is hurting multinationals - whose overseas earnings become less valuable in sterling terms.
Steelmaker Evraz is the top faller, down 6%, followed by NMC Health, the UAE-focused healthcare chain.Steelmaker Evraz is the top faller, down 6%, followed by NMC Health, the UAE-focused healthcare chain.
US-focused plumbing and building materials provider Ferguson has lost 3%, while global advertising firm WPP is down 2.5%.US-focused plumbing and building materials provider Ferguson has lost 3%, while global advertising firm WPP is down 2.5%.
Data firm Panjiva has calculated that America’s new proposed tariffs cover 4.1% of all French exports to the US, worth just over $2.4bn.Data firm Panjiva has calculated that America’s new proposed tariffs cover 4.1% of all French exports to the US, worth just over $2.4bn.
Cosmetics takes the biggest hit, followed by sparkling wine.Cosmetics takes the biggest hit, followed by sparkling wine.
It explains:It explains:
While shares slide, the pound is rising towards its highest level in six months.While shares slide, the pound is rising towards its highest level in six months.
Sterling has just hit $1.30 for the first time in six weeks, and is close to levels not seen since May.Sterling has just hit $1.30 for the first time in six weeks, and is close to levels not seen since May.
The pound often rises when opinion polls suggest Boris Johnson will win a majority next week. The latest poll shows the Conservative Party still holds a lead over Labour.The pound often rises when opinion polls suggest Boris Johnson will win a majority next week. The latest poll shows the Conservative Party still holds a lead over Labour.
The pound is also benefitting from the weaker dollar, which took a hit from disappointing US manufacturing data yesterday.The pound is also benefitting from the weaker dollar, which took a hit from disappointing US manufacturing data yesterday.
Agathe Demarais, Global Forecasting Director at The Economist Intelligence Unit, suspects that Donald Trump won’t actually impose those new tariffs on French champagne, cheese, handbags and cosmetics.Agathe Demarais, Global Forecasting Director at The Economist Intelligence Unit, suspects that Donald Trump won’t actually impose those new tariffs on French champagne, cheese, handbags and cosmetics.
Why? Because it would drive up prices in the shops - not a good idea in an election year.Why? Because it would drive up prices in the shops - not a good idea in an election year.
Demarais says:Demarais says:
But even so, the threat shows that US-European relations are weakening:But even so, the threat shows that US-European relations are weakening:
ITV’s Joel Hills points out that the UK could soon have its own digital services tax -- it’s in the Conservative manifesto!ITV’s Joel Hills points out that the UK could soon have its own digital services tax -- it’s in the Conservative manifesto!
Labour has also promised to tax US tech giants more, to better reflect the profits they make in the UK.Labour has also promised to tax US tech giants more, to better reflect the profits they make in the UK.
We flagged up earlier that the US is threatening to sanction Italy over its digital tax scheme, following last night’s move against France. Could the UK be next?...We flagged up earlier that the US is threatening to sanction Italy over its digital tax scheme, following last night’s move against France. Could the UK be next?...
This tweet shows the moment when Trump’s comments on China hit the wires, and rattled the Wall Street futures market:This tweet shows the moment when Trump’s comments on China hit the wires, and rattled the Wall Street futures market:
Investors are very disappointed by the prospect of waiting another year for a US-China trade deal, says Neil Wilson of Markets.com.Investors are very disappointed by the prospect of waiting another year for a US-China trade deal, says Neil Wilson of Markets.com.
The FTSE 250 index, which contains medium-size companies, has shed 0.8% today.The FTSE 250 index, which contains medium-size companies, has shed 0.8% today.
That’s a fall of 167 points today, to 20,531 - its lowest level in over a week.That’s a fall of 167 points today, to 20,531 - its lowest level in over a week.
Investors are now worrying that America might impose another swathe of tariffs on China in two weeks time.Investors are now worrying that America might impose another swathe of tariffs on China in two weeks time.
President Trump has previously threatened to impose 15% levies on $160 billion of Chinese imports on December 15, if a trade deal hadn’t been reached by then.President Trump has previously threatened to impose 15% levies on $160 billion of Chinese imports on December 15, if a trade deal hadn’t been reached by then.
Markets had been expecting America to hold fire, but Trump’s comments on China today may prompt a rethink. And that could spook markets badly.Markets had been expecting America to hold fire, but Trump’s comments on China today may prompt a rethink. And that could spook markets badly.
As Bloomberg reported:As Bloomberg reported:
The US stock market is now expected to open lower, following Donald Trump’s un-urgent comments about China.The US stock market is now expected to open lower, following Donald Trump’s un-urgent comments about China.
The Dow is tipped to drop by around 0.3%, according to the futures market.The Dow is tipped to drop by around 0.3%, according to the futures market.
Yesterday it shed almost 1%, after the president slapped Brazil and Argentina with tariffs on their steel and aluminium exports to America.Yesterday it shed almost 1%, after the president slapped Brazil and Argentina with tariffs on their steel and aluminium exports to America.
Donald Trump has alarmed investors by declaring that he’s really in no rush to reach a trade deal with China.Donald Trump has alarmed investors by declaring that he’s really in no rush to reach a trade deal with China.
In London, the FTSE 100 has slumped by 81 points or over 1% to 7,203 points, its lowest level in almost two weeks.In London, the FTSE 100 has slumped by 81 points or over 1% to 7,203 points, its lowest level in almost two weeks.
Mining stocks are leading the selloff, as a deeper trade war between Washington and Beijing is bad news for commodity prices.Mining stocks are leading the selloff, as a deeper trade war between Washington and Beijing is bad news for commodity prices.
Boom! Donald Trump has suggested that a trade deal with China could be a year away.Boom! Donald Trump has suggested that a trade deal with China could be a year away.
Asked if it could be agreed by the end of 2019, he replies that any deal is dependent on one thing - whether he wants to do it.Asked if it could be agreed by the end of 2019, he replies that any deal is dependent on one thing - whether he wants to do it.
The president claims that America is doing “very well” from the trade war, citing the $28bn financial aid handed to US farmers. He claims this came from the tariffs paid by China -- even though tariffs are actually paid by American companies when they import goods from China.The president claims that America is doing “very well” from the trade war, citing the $28bn financial aid handed to US farmers. He claims this came from the tariffs paid by China -- even though tariffs are actually paid by American companies when they import goods from China.
Trump then accuses China of “ripping off the US for many, many years”, and now being desperate to end the trade war.Trump then accuses China of “ripping off the US for many, many years”, and now being desperate to end the trade war.
He adds:He adds:
That may alarm investors, who had been hoping for a Phase One trade deal for a while. The next US election is in November 2020.....That may alarm investors, who had been hoping for a Phase One trade deal for a while. The next US election is in November 2020.....