Published: Thu, November 01, 2018
Money | By Bruce West

How major United States stock indexes fared Monday

How major United States stock indexes fared Monday

Bloomberg, citing "three people familiar with the matter", reported that the administration was planning to announce tariffs covering all remaining Chinese imports if talks between Trump and Xi failed to "ease the trade war".

The US levied tariffs of 10 percent on United States dollars 200 billion of Chinese products in September, with the rate set to increase to 25 percent by the end of the year barring a breakthrough in the trade talks.

Both Trump and Xi are expected to attend next month's G20 summit in Buenos Aires, where they could meet.

This was the nail in the coffin for today's equity bounce. Its stock traded above $2,000 a share in early September and has fallen 24.5 percent since then.The S&P 500, the main benchmark for the USA stock market, has fallen 9.9 percent from its latest record high on Sept. 20.

Full story at Bloomberg.

No decision has been made but preparation for new tariff list are on, in case the meeting does not yield progress towards solving disputes.

Stocks erased gains partly on concern about an escalating trade war between the world's two largest economies.

The trade war started with Trump's steel and aluminum tariffs, quickly escalating to include tariffs on US farm products, most notably soybeans and pork. The tech-heavy Nasdaq composite slid 116.92 points, or 1.6%, to 7,050.29.

"And I have Dollars 267 billion waiting to go if we can't make a deal", Trump said. Ten percent tariffs on $200 billion in imports that took effect in September are due to increase to 25 percent on January 1.

But in recent weeks they've lost some of their confidence, and that's contributed to the market's tumbleThe effects of higher tariffs could be especially severe for technology companies, which make many of their products in China, and for industrial companies, which are already paying higher prices for metals. Previous rounds of U.S. tariffs have taken at least two months to impose once a list of products was announced, allowing for public comments to be aired. The Dow Jones Industrial Average ended down 1 percent, while the Nasdaq fell 1.6 percent, also on weakness in technology and internet shares. IBM fell 4.1 percent to $119.64.The prospect of reduced barriers to trade helped auto makers on Monday.

The slowdown in the second largest economy in the world occurs on the background of a trade war between the United States and China.

The euro drifted down as inflation accelerated in October and underlying price pressures increased, handing policy makers a headache after growth data disappointed. China's overnight repo rate surged the most in more than four years as authorities take steps to combat bets against the yuan, which held near the weakest level in a decade against the greenback. "You have two of the most powerful leaders in the world".

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