ZCZC
BCN-11
EUROPE-MARKETS
European stocks wobble on first US-China trade war shots
LONDON, July 7, 2018 (BSS/AFP) – European stock markets wobbled Friday as
China and the United States fired the first shots in a trade war between the
world’s two biggest economies.
In early afternoon deals, London stocks shed 0.2 percent while Frankfurt
won 0.1 percent and Paris turned flat.
The euro rose against the dollar, while oil prices fell.
US President Donald Trump on Friday rolled out tariffs on $34 billion (29
billion euros) of Chinese goods in what Beijing called the “largest trade
war” in economic history.
China added it had already imposed retaliatory measures on US goods without
immediately providing precise details.
“Stocks are mixed… despite the heightened trade tensions between the US
and China,” said CMC Markets UK analyst David Madden.
Analysts noted that the news had been expected for weeks, leaving traders
to buy back into the market.
Tokyo stocks led the gains in Asia, closing 1.1 percent higher, with
markets in Shanghai and Hong Kong up by around half a percentage point.
Li Daxiao, analyst at Yingda Securities, said news of the tariffs was
already priced in.
“After the US tariffs announcement, the negative news finally came out and
has already been digested over recent weeks. Therefore investors are not in
as much of a panic as before, and the market sentiment will reverse,” said
Li.
Stanley Chik, from Bright Smart Securities International in Hong Kong, said
that “the impact of tariffs on economic growth appears limited for now,
giving the market a breathing spell.”
But these could be just the first skirmishes in a long war, with financial
markets worried about a knock-on effect on the wider global economy and the
broader trading system.
Trump has threatened to impose tariffs on some $450 billion of Chinese
goods — virtually all of China’s exports to the US — as he seeks to advance
his “America First” protectionist agenda.
Beijing has accused the US of “firing on the whole world” with the
measures, pointing out that most of the Chinese goods under attack are made
by companies with large foreign investment — including American.
In New York, traders returned Thursday from the July 4 Independence Day
holiday in a relatively bullish mood, pushing the Dow Jones index up nearly
one percent as they cheered solid US employment data.
BSS/AFP/HR/0950