The Trump administration’s latest shot inside the trade war with China has sent shudders through global financial markets.
The US government said the idea was readying fresh tariffs of 10% on $0 billion worth of Chinese goods, releasing a list including fruit as well as vegetables, handbags as well as baseball gloves.
The Shanghai Composite fell 1.8% as well as Hong Kong’s Hang Seng was down 1.3% Wednesday. China’s currency, the yuan, slid about 0.5% against the dollar.
different markets were also suffering: Japan’s Nikkei closed down 1.2%. Major European indexes dropped more than 1% in early trading, as well as Dow futures were pointing 1% lower.
China’s stock market is actually one of the worst performing inside the earth in 2018, weighed down by fears of a slowdown inside the country’s economy as well as the trade clash with the United States. The Shanghai index entered a bear market at the end of last month, meaning the idea has fallen more than 20% through its recent peak.
Related: US readies fresh tariffs on another $0 billion of Chinese products
Among the Chinese stocks caught inside the crossfire Wednesday were companies with strong ties to the US market. Shares in major household appliances maker Qingdao Haier sank more than 2%. The fresh US list targets products including refrigerators as well as air-conditioning units.
The US announcement comes just days after the United States as well as China imposed tariffs of 25% on $34 billion of each different’s exports.
Jingyi Pan, a Singapore-based market strategist at broker IG Group, said investors were at This specific point bracing for retaliation through Beijing inside the form of more tariffs as well as “different creative methods” for showing its displeasure. which could include creating life difficult for American companies operating inside the earth’s second biggest economy.
Related: China: US has began the biggest trade war in history
China’s Commerce Ministry said Wednesday which the Trump administration’s announcement of fresh measures was “unacceptable.” the idea warned which China might have to respond with “necessary countermeasures” however didn’t provide details.
Gao Qi, a Singapore-based currency strategist at Scotia Bank, said which the absence of any planned trade negotiations to defuse tensions between the two governments was adding to investors’ anxieties.
The Trump administration is actually due to impose tariffs on another $16 billion of Chinese goods This specific summer, which could further pressure the yuan, Qi said.
The Chinese currency fell sharply against the dollar last month as fears over the trade war escalated. China’s central bank spoke out last week, saying the idea’s “paying close attention” to recent fluctuations inside the currency market as well as will seek to keep the yuan stable at a reasonable level.
Qi said he was advising clients to sell the yuan as well as buy the Japanese yen, a currency which is actually often viewed as a safer asset in periods of market turmoil.
sy88pgw (Hong Kong) First published July 11, 2018: 12:40 AM ET