Home / Financial Services/ Stocks rally as Trump tweet eases trade war fears

Stocks rally as Trump tweet eases trade war fears


Comments / {{hitsCtrl.values.hits}} Views / Tuesday, 10 April 2018 00:23

Facebook

 

LONDON (Reuters) - Global stocks rose yesterday (9 April) as the US government played down fears of a trade war with China that has roiled markets over the last week.

The two countries have threatened each other with tens of billions of dollars of tariffs, but officials in President Donald Trump’s administration have stressed the tariffs are not yet in place and the dispute could be resolved through talks.

Trump’s chief economic adviser, National Economic Council Director Larry Kudlow said in an interview on Sunday (8 April) the ongoing spat “might turn out to be very benign.”

In a Twitter post on Sunday, Trump appeared to echo this, saying any tariffs would be reciprocal and that he saw a “Great future for both countries!” MSCI’s world equity index, which tracks shares in 47 countries, was up 0.24%, helped by Europe’s benchmark Stoxx 600 index that rose 0.5%.

“Never ending escalation is not guaranteed ... as China has shown willingness to negotiate in recent months,” said analysts at JPMorgan, who also noted the two countries made significant progress on trade agreements when Trump visited China in November 2017.

But the issue could dominate markets for the foreseeable future given the lengthy public discussion period on US tariff proposals mean the earliest they might be imposed was somewhere around late July or early August.

“This is not going to happen tomorrow, and given the mercurial nature of the US administration, the whole issue could well disappear before anything really happens,” said ACLS Global Chief Strategist Marshall Gittler. “Many market participants may be starting to think that this is just a lot of sound and fury, signifying nothing in the end. But ... you never know, US trade policy is in the hands of someone totally unpredictable.”

The next major hurdle will be a speech by Chinese President Xi at the Boao Forum on Tuesday (10 April).

Russian stock indexes and the rouble both fell yesterday after the United States hit Russian companies and officials as part of an aggressive round of new sanctions to punish Moscow for a range of activities, including alleged meddling in the 2016 US election.

The dollar-denominated RTS stock market index was down 4.5%, its worst single day in over a year, while the rouble was 0.9% weaker against the dollar.

Shares in some Russian companies targeted by the new sanctions, notably those associated with Russian businessman Oleg Deripaska, plunged yesterday.

Hong Kong-listed shares in Deripaska’s aluminium producer Rusal tumbled by nearly half after the company said it could default on some of its debt due to the sanctions.

Elsewhere in currency markets, the dollar steadied on the safe haven yen at 107.07, just short of the recent six-week peak of 107.49.

The euro was flat at $1.2280, and above the recent trough of $1.2212, while the dollar index was a fraction firmer at 90.138.

Oil prices edged up with Brent crude futures for June up 0.58% to $67.49 a barrel, while US crude CLc1 gained rose 0.53% to $62.38 a barrel.


Share This Article

Facebook Twitter


DISCLAIMER:

1. All comments will be moderated by the Daily FT Web Editor.

2. Comments that are abusive, obscene, incendiary, defamatory or irrelevant will not be published.

3. We may remove hyperlinks within comments.

4. Kindly use a genuine email ID and provide your name.

5. Spamming the comments section under different user names may result in being blacklisted.

COMMENTS

Today's Columnists

Privacy in a time of terror

Thursday, 25 April 2019

Trade-offs that are central to public policy are best understood with specific examples, ideally real-world cases rather than made-up ones. The recent request by the Police that those leaving unattended vehicles on the road display their names and co


The worst time in this global war: healing in failure and brokenness?

Thursday, 25 April 2019

These are the worst of times for us all in our belovéd blesséd battered bruised broken bleeding isle. And I’m thinking dark thoughts that the twitterati and other tender-minded philosophers would deem unprintable. But will be publish and be damne


Easter mayhem and grand failure of leadership

Wednesday, 24 April 2019

Never in the history of Sri Lanka has there been such a masterly engineered and flawlessly executed terror attack on soft targets to bring down a calamity of incalculable magnitude. These heartless and mentally deranged criminals who masterminded thi


Countries can recover post-disaster; strong policymakers a must

Wednesday, 24 April 2019

Sri Lanka was devastated on Sunday when suicide bombers went on rampage. Whilst the actual impact will be seen in the near future, what is sad for Sri Lanka is that the policymakers are at sea despite all the experience we had in dealing with the LTT


Columnists More