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Main » Asian markets tumble after Wall St battering as China retaliates — International Business

Asian markets tumble after Wall St battering as China retaliates — International Business

15 May 2019

North American markets rallied Tuesday after enduring a deep hit to start the week due to the escalating U.S.

May 13 (Reuters) - U.S. stock markets fell more than 2% on Monday after China announced retaliatory tariffs on U.S. goods, heightening fears of a full-blown trade war between the world's two largest economies that could cripple global economic growth.

Mr. Trump, unbowed, said the US could up the ante by imposing import taxes on another $325 billion worth of Chinese goods.

China on Monday boasted it will "never yield to external pressure" and is determined to protect its rights, said Geng Shuang, spokesperson for the Ministry of Foreign Affairs. "China's countermeasures have shown our determination to safeguard the multilateral trade system".

Investors also returned to stocks of tech companies, which may have the most to lose from a protracted U.S.

Those signals were enough for now to provide respite to battered markets.

"Their (sic) is no reason for the USA consumer to pay the Tariffs, which take effect on China today", Trump tweeted.

The partial recovery was spurred by tweets from U.S. President Donald Trump in which he said the U.S. was in a "much better position" to strike a deal. It said a June 17 hearing would be held before Washington decides how to proceed.

"There's a ripple effect to this because of tariffs", she says.

On Tuesday, at least, such worries eased. Saudi Arabia said two of its oil tankers were among those attacked off the coast of the United Arab Emirates, describing it as an attempt to undermine security of supply amid United States-Iran tensions. Another comment on the site said, "Why are Chinese people bullied?"

Stocks doing business in China got hit the hardest. The falling price has put pressure on USA farmers.

Investors are losing faith that a U.S.

This was accompanied by a smaller spike in Nasdaq Composite which climbed 0.7 percent. Hong Kong, Australia and Taiwan fell. The S&P 500 was up 22.54 points, or 0.80 percent, to 2,834.41. The S&P 500 headed for the biggest decline in four months and the Dow Jones Industrial Average slumped more than 500 points. Details of what the duties were before the increases were unclear.

"However, I think traders might underestimate the consequences if there is no deal and furthermore, tough trade negotiations between the USA and the European Union are still to follow later this year, which could spell new turmoil for stocks". He told reporters, "I have not made that decision yet". "You had a great deal, nearly completed & you backed out!" Both governments indicated more talks are likely but set no date.

While Trump has asked China to "act now", investors didn't have to wait for such a call from the US President before taking risk off the table.

The time before then will be "highly volatile" for financial markets, said Macquarie Bank analysts in a report. The official statements by representatives of both the United States and China over the past month have been consistently saying that trade talks were progressing and agreeing on various subsets of the deal, so this reversal was unexpected. Farming equipment maker Deere drove losses in the industrial sector, reflecting worries about the impact of tariffs on USA farmers.

So how will Americans feel the brunt of the new tariffs? That has sent shockwaves through other Asian economies that supply Chinese factories.

Asian markets tumble after Wall St battering as China retaliates — International Business