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You can find the current article at its original source at https://www.theguardian.com/business/live/2019/may/23/trade-war-china-us-fight-panasonic-huawei-business-live
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| Wall Street joins market selloff as trade war hits US economy - as it happened | |
| (about 3 hours later) | |
| And finally...stocks have closed lower on Wall Street, as investors prepare for relations between the US and China to remain bumpy. | |
| The Dow lost more than 1%, or 286 points, to end at 25,490. The S&P shed 1.2% while the Nasdaq lost 1.5% as tech stocks bore the brunt of the declines. | |
| Here’s our write-up of the day: | |
| Global markets rocked as US-China trade and tech rift deepens | |
| Goodnight! GW | |
| Trade wars are so good and easy to win that the US government is | Trade wars are so good and easy to win that the US government is |
| AFP has the details: | AFP has the details: |
| United States on Thursday unveiled a new $16 billion aid package to help farmers caught in the crossfire of President Donald Trump’s trade war with China. | United States on Thursday unveiled a new $16 billion aid package to help farmers caught in the crossfire of President Donald Trump’s trade war with China. |
| Agriculture Secretary Sonny Perdue said the bulk of the funds will go to direct payments to farmers, while a small portion will be used to purchase food to use in US aid programs like food banks and school lunch programs. | Agriculture Secretary Sonny Perdue said the bulk of the funds will go to direct payments to farmers, while a small portion will be used to purchase food to use in US aid programs like food banks and school lunch programs. |
| “The plan we are announcing today ensures farmers do not bear the brunt of unfair retaliatory tariffs imposed by China and other trading partners,” Perdue told reporters in a conference call. | “The plan we are announcing today ensures farmers do not bear the brunt of unfair retaliatory tariffs imposed by China and other trading partners,” Perdue told reporters in a conference call. |
| “Farmers would rather have trade than aid but without the trade they are going to need some support.” | “Farmers would rather have trade than aid but without the trade they are going to need some support.” |
| China’s call today for America to fix its ‘wrong actions’ has worried investors, and made them realise that the trade war may not end for some time. | China’s call today for America to fix its ‘wrong actions’ has worried investors, and made them realise that the trade war may not end for some time. |
| Marketwatch says: | Marketwatch says: |
| U.S. investors are beginning to adjust to the idea of a protracted standoff between the U.S. and China as increased trade friction have continued to weigh on the broader market and the technology sector in particular. | U.S. investors are beginning to adjust to the idea of a protracted standoff between the U.S. and China as increased trade friction have continued to weigh on the broader market and the technology sector in particular. |
| Weakness in global markets spread to the U.S. as investors digested the implications of new U.S. export restrictions placed on Chinese telecom firm Huawei Technologies Co., with The Wall Street Journal reporting that U.K.-chip design company Arm Holdings was halting business with Huawei, sparking volatility overnight. | Weakness in global markets spread to the U.S. as investors digested the implications of new U.S. export restrictions placed on Chinese telecom firm Huawei Technologies Co., with The Wall Street Journal reporting that U.K.-chip design company Arm Holdings was halting business with Huawei, sparking volatility overnight. |
| There’s no relief from the selling on Wall Street, in early afternoon trading. | There’s no relief from the selling on Wall Street, in early afternoon trading. |
| The Dow is still down just over 400 points, or 1.5%, while the tech-focused Nasdaq is down almost 1.9%. | The Dow is still down just over 400 points, or 1.5%, while the tech-focused Nasdaq is down almost 1.9%. |
| The news that US factory growth has hit a nine-year low hasn’t cheered traders, who remain anxious about the tech ‘cold war’ breaking out between Washington and Beijing. | The news that US factory growth has hit a nine-year low hasn’t cheered traders, who remain anxious about the tech ‘cold war’ breaking out between Washington and Beijing. |
| U.S. Secretary of State Mike Pompeo has ratcheted up the pressure on Huawei, dismissing the company’s claim to be independent of Beijing. | U.S. Secretary of State Mike Pompeo has ratcheted up the pressure on Huawei, dismissing the company’s claim to be independent of Beijing. |
| Pompeo told CNBC that the company is “deeply tied” to China, and also the Chinese communist party. | Pompeo told CNBC that the company is “deeply tied” to China, and also the Chinese communist party. |
| “To say that they don’t work with the Chinese government is a false statement. The Huawei CEO - on that, at least - isn’t telling the American people the truth.” | “To say that they don’t work with the Chinese government is a false statement. The Huawei CEO - on that, at least - isn’t telling the American people the truth.” |
| That’s another sign that relations between the two sides are far from strong. | That’s another sign that relations between the two sides are far from strong. |
| Ouch! European traders have been left reeling from another day of trade war tensions. | Ouch! European traders have been left reeling from another day of trade war tensions. |
| The FTSE 100 has just closed down 103 points, or 1.4%, at 7231. Engineering firm Babcock was the worst performer, shedding 9% - yesterday it warned that profits would be down this year. | The FTSE 100 has just closed down 103 points, or 1.4%, at 7231. Engineering firm Babcock was the worst performer, shedding 9% - yesterday it warned that profits would be down this year. |
| Holiday firm TUI lost 5% -- amid no-deal Brexit worries, and forecasts that more British holidaymakers will stay at home this year (especially given the pound’s recent problems). | Holiday firm TUI lost 5% -- amid no-deal Brexit worries, and forecasts that more British holidaymakers will stay at home this year (especially given the pound’s recent problems). |
| There are heavier losses elsewhere, with Germany’s DAX and Franc’s CAC 40 both losing more than 1.7%. | There are heavier losses elsewhere, with Germany’s DAX and Franc’s CAC 40 both losing more than 1.7%. |
| European Closing Prices:#FTSE 7231.04 -1.41%#DAX 11952.41 -1.78%#CAC 5281.37 -1.81%#MIB 20136.39 -2.12%#IBEX 9114 -1.28% | European Closing Prices:#FTSE 7231.04 -1.41%#DAX 11952.41 -1.78%#CAC 5281.37 -1.81%#MIB 20136.39 -2.12%#IBEX 9114 -1.28% |
| I missed this earlier (sorry!)..... but US factory growth has slumped to its lowest rate in over nine years. | I missed this earlier (sorry!)..... but US factory growth has slumped to its lowest rate in over nine years. |
| Today’s report from Markit (see here) shows that the U.S. Manufacturing PMI fell to just 50.6 this month, from 52.6 in April. | Today’s report from Markit (see here) shows that the U.S. Manufacturing PMI fell to just 50.6 this month, from 52.6 in April. |
| That’s a 116-month low -- helping to drag the overall PMI to a three-year low. | That’s a 116-month low -- helping to drag the overall PMI to a three-year low. |
| Factory bosses have reported that output, employment and inventory stocks have all slowed, while, while new orders fell for the first time since August 2009. | Factory bosses have reported that output, employment and inventory stocks have all slowed, while, while new orders fell for the first time since August 2009. |
| This all suggests the US economy is stumbling, due to weakness at home and abroad. | This all suggests the US economy is stumbling, due to weakness at home and abroad. |
| Markit says: | Markit says: |
| New orders were stymied by reports of weaker overall demand conditions and hesitancy among clients to place orders. | New orders were stymied by reports of weaker overall demand conditions and hesitancy among clients to place orders. |
| The fall in new business was only fractional, but signalled a marked turnaround from the solid rise seen in April. Data suggested that demand from both domestic and foreign clients declined during the month, as exports also fell. | The fall in new business was only fractional, but signalled a marked turnaround from the solid rise seen in April. Data suggested that demand from both domestic and foreign clients declined during the month, as exports also fell. |
| US manufacturing activity dives to more than 9-year low on trade war worries, survey shows: https://t.co/DfWSFpgxoF @YunLi626 $SPY $QQQ pic.twitter.com/TIrrUClGq1 | US manufacturing activity dives to more than 9-year low on trade war worries, survey shows: https://t.co/DfWSFpgxoF @YunLi626 $SPY $QQQ pic.twitter.com/TIrrUClGq1 |
| European stock markets are limping to the close, with heavy losses in London, Frankfurt and Paris: | European stock markets are limping to the close, with heavy losses in London, Frankfurt and Paris: |
| Nearly every one of the 30 companies which make up the Dow Jones industrial average is in the red today. | Nearly every one of the 30 companies which make up the Dow Jones industrial average is in the red today. |
| Tech firms are leading the way, with IBM down 3% and United Technologies losing 2.6%. | Tech firms are leading the way, with IBM down 3% and United Technologies losing 2.6%. |
| Oil companies are also tracking the slump in the price of crude, with Chevron and Exxon both losing around 2.2%. | Oil companies are also tracking the slump in the price of crude, with Chevron and Exxon both losing around 2.2%. |
| Weak economic data from Germany today is helping to pull markets down, says David Madden, market analyst at CMC Markets. | Weak economic data from Germany today is helping to pull markets down, says David Madden, market analyst at CMC Markets. |
| He points to this morning’s PMI report, showing German factories are still shrinking. | He points to this morning’s PMI report, showing German factories are still shrinking. |
| European stock markets are suffering today as the US-China trade tensions have increased. There are no planned meetings between both sides, and that is sending out a very negative message. The 90 day delay in relation to the Huawei ban helped stocks at the start of the week, but that now feels like a long time ago. | European stock markets are suffering today as the US-China trade tensions have increased. There are no planned meetings between both sides, and that is sending out a very negative message. The 90 day delay in relation to the Huawei ban helped stocks at the start of the week, but that now feels like a long time ago. |
| It appears that all the progress that was made throughout 2019 has gone up in smoke in a few weeks. Adding to the selling pressure was the dreadful manufacturing numbers from Germany. If the powerhouse of Europe is suffering, that is likely to ripple out across the region. | It appears that all the progress that was made throughout 2019 has gone up in smoke in a few weeks. Adding to the selling pressure was the dreadful manufacturing numbers from Germany. If the powerhouse of Europe is suffering, that is likely to ripple out across the region. |
| Germany's Manifacturing PMI falls again to 44.3 from previous 44.4 in May, while analysts expected a rise to 44.8. French's business morale is higher, with PMI rising to 50.6, more than expected 50.0. Trade war seems to hit Berlin much more than Paris. @graemewearden | Germany's Manifacturing PMI falls again to 44.3 from previous 44.4 in May, while analysts expected a rise to 44.8. French's business morale is higher, with PMI rising to 50.6, more than expected 50.0. Trade war seems to hit Berlin much more than Paris. @graemewearden |
| The sight of Wall Street plunging into the red hasn’t helped nerves in the City. | The sight of Wall Street plunging into the red hasn’t helped nerves in the City. |
| The FTSE 100 is now down 110 points, or 1.5%, while France’s CAC has lost almost 2% of its value. | The FTSE 100 is now down 110 points, or 1.5%, while France’s CAC has lost almost 2% of its value. |