Donald Trump criticises China for being ‘spoiled’ on trade, Wall Street turns negative



Posted

May 18, 2018 07:51:46

US President Donald Trump’s comments about China and other countries becoming “spoiled” did not help market sentiment on Wall Street.

Markets at 7:20am (AEST):

  • ASX SPI 200 futures +0.2pc, ASX 200 (Thursday close) -0.2pc to 6,094
  • AUD: 75.11 US cents, 55.54 British pence, 63.64 Euro cents, 83.19 Japanese yen, $NZ1.09
  • US: Dow Jones -0.2pc at 24,714, S&P 500 -0.1pc at 2,720, Nasdaq -0.2pc at 7,382
  • Europe: FTSE +0.7pc at 7,788, DAX +0.9pc at 13,115, Euro Stoxx 50 +0.8pc at 3,592
  • Commodities: Brent crude +0.3pc at $US79.50/barrel, spot gold flat at $US1,290/ounce

Speaking to reporters at the White House, Mr Trump said China had “ripped off” the United States for too long, and that he had told Chinese President Xi Jinping “we just can’t do that anymore”.

A second round of talks between senior Trump administration officials and their Chinese counterparts started at the US Treasury on Thursday morning (local time).

“Will that be successful? I tend to doubt it,” Mr Trump said.

“The reason I doubt it is because China has become very spoiled. The European Union has become very spoiled.

“Other countries have become very spoiled, because they always got 100 per cent of whatever they wanted from the United States.”

Mr Trump has threatened to impose up to $US150 billion in punitive tariffs to combat what he says is Beijing’s misappropriation of US technology through joint venture requirements and other policies.

Beijing has threatened equal retaliation, including tariffs on some of its largest US imports, including aircraft, soybeans and automobiles.

How did Wall Street react?

US markets dipped after Mr Trump’s comments, as traders and investors hoped talks will avoid major tariffs proposed by both countries.

The Dow Jones Industrial Average fell 0.2 per cent to 24,714. The S&P 500 and Nasdaq slipped by 0.1 and 0.2 per cent respectively.

Walmart stocks fell 1.9 per cent, and were the biggest drag on the Dow. This was after the retail giant said its profit margins were under pressure due to price cuts and higher freight costs.

Once again, energy was the best performing sector overnight, boosted by oil prices.

Brent crude oil prices have climbed to $US79.0 US dollars a barrel, pushing past a three-and-a-half-year high.

Australian market today

ASX futures have gained 14 points (or 0.2 per cent), which indicates the Australian share market is headed for a stronger start — despite Wall Street’s downbeat day.

In currencies, the Australian dollar has fallen slightly to 75.1 US cents and 55.6 British pence.

Topics:

stockmarket,

business-economics-and-finance,

economic-trends,

markets,

budget,

australia,

china,

united-states



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