President Trump announced earlier on Tuesday that he plans on waiting for the 2020 presidential elections before finalizing the trade deal with China. Following the statement, U.S equities immediately turned red, as per the sources.
Dow Jones Industrial Average Is Having Another Bad Day With A Drop Of Over 450 Points
The Dow Jones Industrial Average was reported to have dropped by over 450 points. The decline was even more prominent owing to the trade vulnerable stocks like 3M, Caterpillar, and Apple. Micron, AMD, and Nvidia stocks, on the other hand, weighed on the benchmark S&P 500 index and led to a loss of 1.2% earlier in the day. Nasdaq Composite, the third prominent Wall Street index, printed a 1.3% loss for the day on Tuesday.
Financial markets were further pushed down following Fox News report on Tuesday that the United States intends to increase the tariffs on Chinese goods on December 15th, in line with the originally declared schedule. All in all, Apple Inc. noted a loss of 2.7% for the day, while Caterpillar and Intel preceded the tech giant with 2.7% and 2.4% loss on Tuesday respectively.
Wilbur Ross in his capacity as the Commerce Secretary highlighted on Tuesday that staff-level negotiations may continue with China, however, high-level discussions are unlikely to be held further at this stage.
Trump’s announcement combined with Washington’s decision of imposing tariffs on metal imports from Brazil and Argentina penetrated further into the European markets as well. The FTSE 100 index noted a 1.75% loss on Tuesday. Having started the day at around 7,286, the UK’s blue-chip index was seen trading as low as 7,138 on Tuesday. The index is currently trading at 7,168.
Trump Administration To Also Impose Tariffs On The European Union
In a separate statement, the White House also expressed its plans of imposing tariffs on the European Union including France. FTSE 100 listed oil majors like British Petroleum and Shell were reported trading lower following the announcement. The mining sub-index, .FTNMX1770, also printed a 1.5% loss on Tuesday.
The broader FTSE 250 index also declined 0.1% this morning. On the contrary, Centamin recorded an incredible 10% hike in the share prices. Analysts of the stock market cited a buyout proposal valued at £1.47 billion by Canada’s endeavor mining to have fueled the surge.
Commenting on the drop in the global financial markets, President Trump also stated that the slump is nothing more than a hiccup that is unlikely to scare him into making a rash decision regarding a trade deal with China.