Global stock markets fell on Thursday after President Donald Trump renewed his attack on China ahead of trade talks between the two countries.
US President Donald Trump slammed China during a rally in Florida on Wednesday, saying he decided to raise tariffs on 200 billion USD worth of Chinese goods because the country had “broke the deal”. The increased tariffs will take effect just after midnight on Friday, the Trump administration confirmed earlier this week.
China said Wednesday that it would retaliate if Washington goes ahead with the tariff increases. A delegation led by the country’s top trade negotiator, Liu He, will travel to Washington for the talks on Thursday.
Asian markets recap
Asian markets ended Thursday’s trading session mostly into the red, as the investors remain cautious amid US President Donald Trump’s statements that the authorities in China are responsible for the failure of the trade talks.
In China, both Shanghai Composite and Shenzhen Components ended the session with declines of more than 1.3%. Meanwhile, the index Shenzhen Composite wiped out almost 1.4% and the Hong Kong’s benchmark Hang Seng was down by 2.26%. Chinese banks throttled back new lending in April after a record first quarter that sparked fears of more bad loans, but analysts say the central bank will likely have to step up support for the economy as trade tensions with the United States escalate. Global investors are closely watching to see how much more support Beijing will inject to shore up growth. But those policy expectations are swinging wildly as a sudden blowup in diplomatic ties threatens China’s nascent recovery.
In Japan, the blue-chip index Nikkei 225 dropped by 0.93%, while Topix declined by 1.21%. The shares of the car maker Honda Motor fell by nearly 4.7%, although the company predicts a 6% increase in operating profit for the current fiscal year.
South Korean index Kospi fell by more than 3%, with SK Hynix’s stock price dropping by 5.35%.
Only the Australian index S&P ASX 200 ended the trading into the gree, rising by 0.42% with most of its sectors growing.
European markets mid-session recap
Major European indexes also moved lower in early trade. Losses were limited to 0.4% on London’s FTSE 100, but Paris’ CAC 40 and Frankfurt’s DAX suffered steeper declines.
German index DAX 30 is trading with a decrease of 97.8 points, or 0.80%, to 12,082.13 points at 10:15 GMT. The stocks of carmakers continue their downtrend with Volkswagen wiping out 1.8%, while Daimler dropped by 1.5%. Deutsche Bank and BASF also wiped out more than 1%, while Bayer stocks are trading with a decrease of 2.7%.
French index CAC 40 edged lower by 1.28% to 5,348.07 points in mid-session deals. the stocks of Renault fell by 2.8%, while Peugeot declined by 1.97%. the shares of Airbus are down by 0.7%, while BNP Paribas and Societe Generale fell by 2.1% and 1.7%, respectively.
Leading British shares fell to six-week lows on Thursday as renewed trade tensions between the United States and China pressured the index. The blue-chip index FTSE 100, whose members generate more than two-thirds of their earnings from abroad, declines by 0.37% to 7,243.85 points. Energy supplier Centrica, oil heavyweight BP and insurer Admiral all dipped as they traded ex-dividend, heavily weighing on the blue-chip bourse.
Wall Street pre-session recap
Wall Street stock index futures were lower on Thursday morning, as market participants continued to monitor trade relations between the US and China.
Around 6 a.m. ET, Dow futures indicated a negative open of more than 120 points. Futures on the S&P and Nasdaq were also lower.
Traders will also keep an eye on upcoming data releases. There will be international trade figures, weekly jobless claims, and producer price index numbers out at 8.30 a.m. ET.