Wednesday, 24 July, 2019

USA stocks plummet on concerns over growth, earnings prospects

Defense Secretary James Mattis welcomes Chinese Minister of National Defense Gen. Wei Fenghe to the Pentagon U.S. and Chinese flags are seen in Arlington Virginia U.S
Ginger Lawrence | 15 May, 2019, 05:13

But the European benchmark has outpaced its US peer by about 0.4 percentage points since then.

Erik Nielsen, chief economist at UniCredit in London, labeled the move "aggressive", adding that it could now be hard for either party to climb down, given nationalist sentiment.

Investors responded by fleeing equities for safe-haven assets.

On Friday, after two days of negotiations, Washington raised tariffs on $200 billion worth of Chinese goods to 25% from 10% and threatened to extend additional levies to all imports from China, prompting threats of retaliation from Beijing.

Investors have begun to adjust their investment outlooks to factor in more uncertainty on the trade front, at least for the near term.

"Indeed, it probably won't invert much more at all, if we are right that the Fed has already delivered its final rate hike in this cycle". These adjustments will continue after Monday, she said. Their stocks advanced 7.7% and 4.9%, respectively. But China's blue-chip CSI300 index turned higher in volatile trade, gaining 0.3%.

Most recently he worked with TradeTheNews.com, where he provided market analysis on economic data and corporate news.

"Since we see a trade accord being reached in the not-too-distant future, we don't expect the market to endure more than a short-lived spate of indigestion", said Sam Stovall, chief investment strategist at CFRA. "The market is starting to realize the situation is as bad as it could be".

US equity futures rose Tuesday as investors weighed the impact of the escalating trade war between the United States and China.

All three major U.S. indexes lost ground on Monday in a widespread sell-off, with the tech-heavy Nasdaq posting its biggest one-day percentage loss this year.

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Market volatility has jumped. The index jumped again on Monday.

Technology companies, which do a lot of business with China, led the way lower.

Trade bellwether Caterpillar fell 5% while Apple dropped 5.2%.

The Dow Jones Industrial Average was up 207.06 points, or 0.82 percent, to 25,532.05 on Tuesday.

Ten-year yields fell below those on three-month Treasury bills.

That move underscored worries about the economic impact of a trade war - a sustained inversion of that part of the yield curve has preceded every USA recession in the past 50 years.

Investors' nerves were calmed after US President Donald Trump referred to the escalating trade war with China as "a little squabble" and added, "We have a good dialogue going".

World stocks held near two-month lows on Tuesday as slightly more optimistic comments from US and Chinese officials on trade brought some comfort, a day after equities suffered their worst selloff so far this year. Stocks came off their lows in afternoon trading Monday after Trump said he had not decided if he would slap tariffs on the remainder of Chinese goods.

Though only a small margin, that's a marked change from the past year during which the index has lagged the US market by 9%, as investors have anxious about Italy's bulging budget deficit, slowing economic and corporate growth and Britain's chaotic exit from the European Union.

"However, I think traders might underestimate the consequences if there is no deal and furthermore, tough trade negotiations between the US and the European Union are still to follow later this year, which could spell new turmoil for stocks".