Monday, 16 July, 2018

China trade war concerns pull Sensex, Nifty down over 1%

Sensex rises for third straight session Markets open on a higher note on Wednesday
Gustavo Carr | 05 April, 2018, 01:55

At 2.19 pm, the BSE Sensex was down 306.91 points or 0.92% to trade at 33,063.72, while the broader NSE Nifty had also shed more than a percent to trade at 10,137.00, down 108 points.

According to market observers, the domestic equity markets reacted to intensifying trade war fears after China announced additional tariffs on U.S. goods as countermeasures to the USA administration's proposed tariffs covering Chinese exports worth $50 billion with a suggested tariff rate of 25 per cent. China has said it would levy a 25 per cent tariff on imports of 106 U.S. products, including soybeans, automobiles and aircraft, in response to proposed American duties on its high-tech goods.

The escalating tariff war between the USA and China, with the Asian giant announcing retaliatory trade measures on Wednesday, shaved 352 points off the sensex which closed at 33,019. Most Asian peers, too, ended in the red. The trade dispute spooked investors and raised concerns of global growth slowing. Despite opening on a flat note, the benchmark indices succumbed to global pressures to finally close the day with losses of over one per cent.

"The re-emergence of a trade war has disturbed the momentum". It's quite crucial that trade tensions be diffused for a sustained bullish recovery. For Dalal Street, Thursday's RBI policy, the upcoming results season and political developments would dictate the market's trend and should to be watched closely, experts said.

Yankees' Tanaka posts 1st win of 2018 season
Pillar got third base when catcher Luke Maile jogged to second base, hoping to draw Sanchez to throw so Pillar could go home. The New York Yankees look for a bounce back win after losing Saturday when allowing two runs in the bottom of the eighth.

Meanwhile, the market is looking ahead to the central bank's monetary policy review, due tomorrow. There is consensus on the status quo being maintained on repo rates, but the markets will be interested in RBI commentary and its plan of action to address the rising bond yields. Tata Steel was the worst performer in the index as it fell 3.29 per cent, followed by Axis Bank at 2.61 per cent.

On Wednesday, foreign investors were net buyers to the tune of Rs 3.35 billion, while their domestic counterparts pulled out Rs 1.5 billion from the domestic market.

Both benchmarks plunged over 1 per cent.

Elsewhere in Asia, Hong Kong's Hang Seng was up 0.20 per cent, while Japan's Nikkei rose 0.46 per cent in early trade today.