Trade War News

Investors were greeted by a sea of red across global equities markets Monday, as U.S. and European stocks fell following a slump in Asia at the start of a crunch week for global trade. Political risks sent the dollar higher with Treasuries, roiling emerging markets.

“Trade and tariff tensions continued to weigh on global equities as well as emerging market currencies,” John Stoltzfus, the chief investment strategist at Oppenheimer & Co., wrote in a note to clients Monday. “This is likely to persist particularly as the July 6 deadline looms for the Trump Administration’s planned imposition of tariffs.”

StockMarketNews.today – Emerging-market stocks retreated, giving up almost half of Friday’s gain, while developing-nation currencies also fell. Mexico’s peso reversed gains following the country’s presidential elections. Earlier, benchmarks in Japan, China and South Korea tumbled. The MSCI Asia Pacific Index sank to its lowest level since in 10 months. The yuan weakened, resuming its sharpest drop since China’s August 2015 devaluation.

Britain’s pound declined in yet another big week for Brexit, and the euro came under pressure as tensions deepened in the German coalition. Miners were the biggest losers in Europe as metals slid, and West Texas oil fell below $74 a barrel after U.S. President Donald Trump called for increased production.

Trade-war jitters, political risk in Europe and divergence in monetary policy across the world remain some of the key issues worrying investors. In China, weaker-than-expected manufacturing data for June added to concern that the country’s growth is softening, while in Japan confidence among large manufacturers slipped during the second quarter.

“It’s not a happy start to the second half,” Ole Hansen, head of commodity strategy at Saxo Bank A/S, said by email from Copenhagen. “Trade war concerns, U.S. sanctions, Trump’s rants and political problems in Europe, as well as worries about slowing emerging-market growth are all playing their part.”

These are key events coming up this week:

The Reserve Bank of Australia has a policy decision Tuesday.

The U.S. celebrates Independence Day on Wednesday, July 4.

Stock and bond markets are closed, along with government offices.
Federal Reserve releases minutes of its June 12-13 meeting, when FOMC policy makers raised the benchmark rate a quarter point for the second time this year and lifted the median forecast to four total increases in 2018.
U.S. payrolls are due Friday.
Also on Friday, the U.S. is scheduled to impose tariffs on $34 billion of Chinese goods. Beijing has said it will slap tariffs on an equal value on U.S. exports including agricultural and auto exports.

 

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