U.S. preparing new round of tariffs if talks with China fail
- Author: Anthony Vega Nov 02, 2018,
Nov 02, 2018, 1:27
After starting the day up as much as 352 points, the Dow Jones industrial average dipped as low as 566 points into negative territory on a Bloomberg report that said President Trump was preparing to tariff all remaining Chinese imports if next month's talks with President Xi Jinping don't go well.
Trump has long threatened to impose tariffs on all remaining Chinese imports into the United States, which exceed Dollars 257 billion, if Beijing fails to meet USA demands for sweeping changes to Chinese trade, technology transfer and industrial subsidy policies.
The US this year has already imposed tariffs on $250 billion in trade with China.
Bloomberg reported on Monday that the United States is preparing tariffs on all remaining Chinese imports if the talks fail. But Germany's DAX fell 0.2 percent to 11,316 and the CAC 40 in France sank 0.2 percent to 4,980 after weak eurozone growth figures.
"And I have United States dollars 267 billion waiting to go if we can't make a deal", Trump said. The focus turns to Apple Inc. earnings Thursday, then to the monthly U.S.jobs report Friday.
The Nasdaq composite, which is heavily weighted with technology stocks, lost 116.92 points, or 1.6 percent, to 7,050.29. Ten percent tariffs on $200 billion in imports that took effect in September are due to increase to 25 percent on January 1.
The Russell 2000 index of smaller-company stocks slipped 6.51 points, or 0.4 percent, to 1,447.31. "We are watchful of any retaliatory actions from China, as well as possible slump in Chinese technology stocks". The reason the yuan is being dumped now is that investors are concerned about a trade war between America and China.
North American markets started the week higher but again dropped at the end of the day, this time pushed deeper on renewed trade threats against China from U.S. President Donald Trump.
The pan-European STOXX 600 index lost 0.14 per cent.
Futures signaled gains for equities in Hong Kong and China, while Japanese stocks were seen opening slightly lower. The euro rose to $1.1377 from $1.1372. Stocks climbed earlier this month after Bolsonaro led the previous round of voting, as investors preferred him to leftist parties.
The price of USA crude oil dropped 0.8 percent to $67.04 per barrel in NY while Brent crude, used to price global oils, lost 0.4 percent to $77.34 per barrel in London.
US crude fell 1.06 percent to $66.33 per barrel and Brent was last at $76.30, down 1.34 percent.
Benchmark 10-year U.S. Treasury notes last fell 7/32 in price to yield 3.1132 percent, from 3.087 percent late on Monday.
Gold fell 0.1 percent to $1,231.51 an ounce, the biggest fall in a week.