No Trade Deal This Year, Tariffs Threaten France, Markets FallGlobal markets are mixed following a series of sentiment damaging blows. The U.S. market is down -0.75% and extending Monday losses in early Tuesday trading.
The U.S. Markets Are Down In Early Tuesday Trading
The U.S. markets are down in early Tuesday trading after comments from President Donald Trump. Trump said he was Ok with the idea of no Phase 1 trade deal until after the 2020 elections and the market did not take it well. Traders have been banking on a Phase 1 deal this year or early next year at the latest. In other trade-related news, Trump is threatening up to 100% tariffs on some French goods as well. The tariffs are in response to France’s digital tax and its burden to American businesses.
The Dow Jones Industrial Average, S&P 500, and NASDAQ Composite are all down -0.75% to -0.90% in early pre-market action. This move extends losses inflicted on Monday and brings the broad market down to key support at the 30-day EMA. In stock news, shares of international bellwethers Caterpillar, Intel, and Apple are all moving lower. The three are down -1.0% to -1.6% and not the only ones to move lower.
European Markets Are Mixed
The European markets are mixed despite the new revelations from Trump. The German DAX is up 0.15% while both the FTSE and CAC move lower. The CAC is down only -0.90%, surprising considering the threat of 100% tariffs on luxury and other goods. Shares of French luxury brands are down more than -1.0% at midday. Names on the list include Kering, Hermes, and LVMH. The UK FTSE 100 is down more than -1.5% as traders and investors prepare themselves for next week’s elections. In political news, members of NATO are gathering in the UK for a summit and celebration of the organization’s 70th year.
Asian Markets Are Mostly Lower After The U.S. Rout
The Asian markets are mostly lower after the rout in global stocks on Monday. The Shanghai Composite is the only to post a gain and that a small 0.31%. The Australian ASX led the decline with a loss of -2.2%. Trading Down Under was impacted by the RBA’s decision to hold their interests unchanged. The RBA says the three cuts earlier this year are doing their job, employment is expanding.
The Nikkei fell -0.64% while the Korean Kospi and Hong Kong Hang Seng fell -0.38% and -0.20%. In Hong Kong, retail sales fell -26.2% showing the impact of ongoing protests in the city-state. In Korea, shares of SK Hynix led the plunge with a loss of -2.2% as trade fears begin to regain control of the market.