Asian stocks tumble after new Trump tariff threat
BEIJING — Asian stocks tumbled Tuesday after U.S. President Donald Trump escalated a dispute with Beijing over technology policy by threatening a tariff hike on additional Chinese goods.
KEEPING SCORE: The Shanghai Composite Index fell 2.3 percent to 2,953.54 points and Hong Kong's Hang Seng lost 2 percent to 29,685.28. Tokyo's Nikkei 225 retreated 0.9 percent to 22,482.89 and Seoul's Kospi lost 0.8 percent to 2,356.57. Markets in Taiwan, New Zealand and Southeast Asia also declined. Sydney's S&P-ASX 200 gained 0.3 percent to 6,123.00.
TRADE TENSIONS: Trump directed the U.S. Trade Representative to prepare new tariffs on $200 billion in Chinese imports, stepping up a dispute companies and investors worry could drag down global trade and economic growth. Trump accused Beijing of being unwilling to resolve the dispute over complaints it steals or pressures foreign companies to hand over technology. China's Commerce Ministry criticized the White House action as blackmail and said Beijing was ready to retaliate.
ANALYST'S TAKE: "President Donald Trump's unwillingness to back down became apparent this morning, once again sinking markets into a risk-off atmosphere," said Jingyi Pan of IG in a report. "Attention now turns to China for the country's response towards the latest accusations from the White House, but mostly signs of further retaliation."
WALL STREET: U.S. stocks finished mixed in trading that ended before Trump issued his latest tariff threat. Household goods companies took some of the worst losses as the Standard & Poor's 500 index fell for the third time in four days. The S&P 500 fell 0.2 percent to 2,773.75. The Dow Jones industrial average dropped 0.4 percent to 24,987.47. The Nasdaq composite edged up 0.65 points to 7,747.03. The Russell 2000 index of small-cap stocks rose 0.5 percent to a record 1,692.46. Many investors feel smaller and more U.S.-focused companies are less vulnerable in the event of a major trade dispute.
ENERGY: Benchmark U.S. crude lost 26 cents to $65.59 per barrel in electronic trading on the New York Mercantile Exchange. The contract rose 79 cents on Monday to $65.85. Brent crude, used to price international oils, fell 41 cents to $74.93 per barrel in London. The contract rose $1.90 the previous session to $75.34.
CURRENCY: The dollar declined to 109.98 yen from Monday's 110.54 yen. The euro edged up to $1.1633 from $1.1623.
U.S. and European trade chiefs are meeting hours before the U.S. is expected to impose tariffs on European steel and aluminum that could unleash a trade war.
U.S. Commerce Secretary Wilbur Ross told Le Figaro newspaper that a decision on tariffs would likely come after markets close Thursday. The U.S. decision is likely to be to impose tariffs, though there is slim hope that the two sides could reach a last-minute agreement.
Ross met Thursday morning in Paris with French Finance Minister Bruno Le Maire, whose government has vigorously objected to tariffs.
And U.S. Trade Representative Robert Lighthizer is meeting in Paris on Thursday with EU Trade Commissioner Cecilia Malmstrom among other international trade chiefs.
In his Le Figaro interview, Ross said the Americans are still open to discussion, and the EU would be to blame for any trade war if it imposes retaliatory tariffs as expected. — AP
The United States is extending for another six months exemptions from punitive tariffs for dozens of Chinese medical products due to the ongoing coronavirus pandemic, the US Trade Representative announces.
The exclusions from import duties, which were set to expire Tuesday, "cover 81 medical-care products needed to address the Covid-19 pandemic," USTR says in a statement. — AFP
The United States announces that it will impose additional tariffs on French and German products as part of a long-running dispute over subsidies for aircraft manufacturers Airbus and Boeing.
The tariffs are on "aircraft manufacturing parts from France and Germany, certain non-sparkling wine from France and Germany, and certain cognac and other grape brandies from France and Germany," which will be added to the list of products taxed since 2019, according to a statement from the US Trade Representative. — AFP
Government data show the US trade deficit in October unexpectedly fell to its lowest level in more than a year as Americans imported billions less in autos and consumer goods like toys and mobile phones.
The reduction in the deficit -- a central goal of President Donald Trump's aggressive trade agenda -- reflected the decline in the worldwide exchange of goods and services as the global economy weakens.
But it could help lift US economic growth in the final quarter of this year, since deficits subtract from GDP. — AFP
The United States proposes $4 billion in tariffs on a range of European Union products -- including parmesan cheese and Scotch and Irish whiskey -- over subsidies for commercial aircraft.
The list also includes sausages, hams, pasta, olives and many other cheeses including reggiano, provolone, edam and gouda.
"Today, the Office of the US Trade Representative is issuing for public comment a supplemental list of products that could potentially be subject to additional duties," it says in a statement.
The potential tariffs are due to "EU subsidies on large civil aircraft," the statement says.
The EU says the sum of $11.2 billion demanded by the US in tariff counter-measures on a host of European products was exaggerated, as a simmering transatlantic trade row risked escalating.
"The EU is confident that the level of countermeasures on which the notice is based is greatly exaggerated," a European Commission source says, in response to the fresh US tariffs threatened in response to subsidies for Europe's plane-making giant Airbus. — AFP
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