Global stocks fall on worries of more Trump tariffs

SINGAPORE – Global markets were mostly lower Monday following reports that President Donald Trump will place tariffs on $200 billion more in Chinese goods, despite a possible meeting to iron out tensions between the world’s two largest economies.

KEEPING SCORE: In Europe, France’s CAC 40 fell 0.4 per cent to 5,331.94 while the DAX in Germany dropped 0.5 per cent to 12,062.13. Britain’s FTSE 100 declined 0.3 per cent to 7,283.65. Wall Street was set for a muted open. Dow futures fell less than 0.1 per cent to 26,178.00. S&P 500 futures shed 0.1 per cent to 2,910.00.

ASIA’S DAY: South Korea’s Kospi fell 0.7 per cent to 2,303.01 and Hong Kong’s Hang Seng index tumbled 1.3 per cent to 26,932.85. The Shanghai Composite index lost 1.1 per cent to 2,651.79. But Australia’s S&P/ASX 200 rose 0.3 per cent to 6,185.00. Japanese markets were closed for a national holiday. Stocks fell in Taiwan and most of Southeast Asia.

US-CHINA TRADE: The Wall Street Journal reported over the weekend that Trump was going ahead with plans to impose new tariffs on about $200 billion of Chinese imports. The report cited unnamed people familiar with the matter who said the tariff level will likely be set at about 10 per cent, below the 25 per cent announced earlier this year. At the same time, U.S. officials, led by Treasury Secretary Steven Mnuchin, are preparing to hold new talks on the tariff dispute with Beijing. Envoys met last month in Washington but reported no progress. The two governments have already imposed 25 per cent tariffs on $50 billion of each other’s goods. Beijing has issued a list of another $60 billion of American products for retaliation if Trump’s next tariff hike goes ahead.

ANALYST’S TAKE: “Trade issues and their impact on the global economy are likely to dominate investor focus this week,” Stephen Innes of OANDA said in a commentary. “This good cop-bad cop routine continues to undermine Mr. Mnuchin’s efforts as it’s still not clear if anyone other the Trump himself is commissioned to cut a deal. And not too unexpectedly and quite ominously China could cancel the meeting,” he added.

ENERGY: Fears that Hurricane Florence may disrupt supply on the U.S. East Coast boosted oil prices. Benchmark U.S. crude added 51 cents to $69.50 a barrel on Monday. The contract added 0.6 per cent to settle at $68.99 a barrel in New York. Brent crude, used to price international oils, gained 47 cents to $78.56 a barrel. It shed 0.1 per cent to $78.09 a barrel in London.

CURRENCIES: The dollar eased to 112.00 yen from 112.03 yen. The euro strengthened to $1.1649 from $1.1632.