- US President Donald Trump has threatened to increase tariffs on Chinese imports by the end of this week.
- US S&P 500 futures have tumbled 1.6% upon the resumption of trade.
- A trade deal between the two nations had been largely priced in by markets prior to today’s developments.
US President Donald Trump has threatened to increase tariffs on Chinese imports by the end of this week, and US stock futures aren’t liking the news one bit.
As seen in the 5-minute chart below, US S&P 500 futures have tumbled over 1.6% upon the resumption of trade on Sunday evening, setting the tone for what is likely to be an ugly session for stocks across the Asian region on Monday.
As noted by Business Insider’s New-York based reporter Bob Bryan, Trump said current tariffs on $US200 billion worth of Chinese goods will be increased from 10% to 25% and the US will place 25% tariffs on an additional $US325 billion worth of Chinese goods that are currently untaxed on Friday.
He said the slow pace of trade deal negotiations was the cause for the new restrictions.
On Friday, US stocks rallied following the release of US non-farm payrolls for April that revealed stronger-than-expected hiring in April while unemployment fell to a 50-year low of 3.6%.
Despite signs of a further tightening in labour market conditions, US hourly wages failed to accelerate, helping to boost confidence the US Federal Reserve won’t lift official interest rates for the foreseeable future.
However, the optimism created by the jobs report among stock traders seems nothing more that a distant memory following Trump’s latest round of tweets.
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