WASHINGTON, D.C. – Global stocks dipped as doubts over the US-China trade deal increases after the US President Donald Trump warns another increase in tariffs on Chinese goods.
As the market waited for updates on the trade agreement between the US and China, a new statement from President Trump affected the global market, ending in conflicting sentiments this trading session.
On Wednesday’s session, the Wall Street futures started weakly, which followed the sell-off in Asian and European markets. The weak start in the global market was mostly powered by the statement of President Trump threatening another tariff increased if the two countries wouldn’t be able to reach an agreement and the Chinese government condemning a US Senate on Human Rights in Hong Kong.
The displeasure of China towards the Hong Kong Human Rights Democracy Act Senate legislation was a sensitive crossroad in their trade talks with the US. According to reports from a Chinese media, Beijing refused to accept a deal that doesn’t cover the cancellation of existing tariffs from the US.
According to Geng Shuang, a foreign ministry spokesman, the move by the Senate was aiming to reinforce anti-China, which was considered as the violent radical and extremist who tried to break Hong Kong. Shuang also expressed further caution, saying that those attempts to impede or hinder China’s development wouldn’t succeed.
Meanwhile, President Trump stated during a cabinet meeting on Tuesday that if Washington wouldn’t make an agreement with China, he is going to increase the tariffs further. The president further stated that for, in order for the US and China to come to an agreement and end the long-standing trade war, China has to offer a deal that he would like.
The new update and abrupt change in tone from the President’s statement rattled the markets overnight. Asia has dropped, putting the European market on the back foot at the start of the Wednesday trading session.
US equity futures signal more selling early Wednesday, with the Dow Jones marking a 113 drop, S&P 500 going back 12 points, and the Nasdaq Composite dropping about 43 points at the start of the trading day.
European stocks also dipped considerably, with Germany’s DAX dropping 0.8% and Stoxx 600 sliding 0.5%.
Asian stocks also ended Wednesday trading on a weaker note. Global oil prices don’t look optimistic as well, staying firmly in red after the hard tumble it experienced the previous trading day.