ZCZC
BCN-23
EUROPE-STOCKS-MARKETS
Stock markets wary before Trump-Juncker trade talks
LONDON, July 26, 2018 (BSS/AFP) – European stocks moved lower Wednesday
before top-level talks between the United States and the European Union on
resolving a simmering trade dispute that has left investors on edge.
The dollar rose against the euro, while bitcoin briefly broke through
$8,300 before slipping back.
Oil prices rose following a government report showing a decline in US
crude inventories.
European Commission President Jean-Claude Juncker was to meet US President
Donald Trump later Wednesday in Washington in an attempt to avert an
escalation of tariffs.
“An apprehensive day for financial markets has seen significant selling
throughout European stocks ahead of a key US-EU meeting,” said IG market
analyst Joshua Mahony.
“With Trump and Juncker set for trade discussions in Washington later, the
pessimistic stance seen within markets is certainly warranted given the
acrimonious tone taken in previous meetings,” he added.
European stocks ended the day lower. On Wall Street, the Dow was down 0.3
percent in late morning trading although both the S&P 500 and Nasdaq
Composite were in the green.
Mahony noted the decline in Boeing and General Motors highlighted the
difficulty manufacturers are currently experiencing amid growing trade war.
Boeing warned of higher costs and GM cut its profit forecast as it said
higher commodity costs would squeeze its margins.
Trump has threatened to step up his trade war, with European cars in the
crosshairs and all of China’s $500 billion of exports to the US.
In what appeared to be the first acknowledgement that Trump’s aggressive
trade strategy was hurting ordinary Americans, the US government on Tuesday
announced $12 billion in aid for farmers who have been the main target of
retaliatory measures.
Juncker said he was “not very optimistic” about the outcome of his talks
with Trump.
“I know Mr Trump pretty well. I have met him frequently and know how to
deal with him and know how he deals with others. We will negotiate as
equals,” Juncker told German public broadcaster ZDF.
– Fiat skids lower –
Shares in Fiat-Chrysler plunged more than 15 percent in Milan trading
after the automaker disappointed the markets with a drop in net profits,
although for the first time it had generated positive cash flow.
The results were published shortly after it was announced that Sergio
Marchionne, who helped turn around Fiat and merged it with US carmaker
Chrysler, had died. The 66-year-old stepped down at the weekend following
complications from surgery.
Forex.com market analyst Fawad Razaqzada said shares in Fiat-Chrysler and
GM fell sharply after both carmakers “lowered their outlooks due in part to
soaring input costs as a result of surging steel and aluminium costs”
following US tariffs.
GM shares were down 7.3 percent in midday trading in New York.
BSS/AFP/HR/1050