Stock sell-off hits Asia as China strikes back

Beijing's top trade negotiator Liu He warned of retaliatory measures after the United States imposed further tariffs on imports from China

USA stock indices dived more than 2 percent on Monday as investors' sentiment was hit by grave concerns over the prospects of economic expansion and corporate earnings in the coming quarters.

Chipmakers enjoyed a reprieve, with the Philadelphia SE Semiconductor Index rising 2.4 per cent after suffering its worst one-day percentage loss since January 3.

The S&P/TSX composite index closed up 91.12 points to 16,284.53 after hitting an intraday low of 16,206.22.

"The reason we're seeing this recovery is because fundamentals haven't changed", said Kevin Miller, CIO at E-Valuator Funds.

Soybeans, which was the most valuable US export crop, bounced off a decade low on Tuesday as the market's focus shifted to weather-related planting delays that could reduce the crop size.

"That being said, we are going through something that we've never gone through before", Miller said.

U.S. President Donald Trump waves during joint statements with China's President Xi Jinping at the Great Hall of the People in Beijing, China, November 9, 2017.

The euro rose to $1.1236 from $1.1223. Technology stocks posted the largest percentage gains, climbing 1.6 per cent.

Elsewhere in Asia, South Korea's Kospi climbed 0.2% to 2,082.83 and India's Sensex added 0.6% to 37,318.53.

Microsoft shares rose 1.1% to boost the tech sector.

The increase in tariffs announced in Beijing on Monday includes commodities like soybeans, putting pressure on USA farmers.

Donald Trump Jr. agrees to Senate committee interview
A spokesperson for the committee told CBS News last week, "We do not discuss the details of witness engagements with the committee".

The rand and the JSE were on a firmer footing on Tuesday after a big sell-off in the USA overnight. The bank named the soda maker its "top mega-cap staples pick". This is not something that's going to be resolved tomorrow and anybody who says they know exactly how this will play out is spinning a yarn, ' said Luken.

Trump warned Xi on Twitter that China "will be hurt very badly" if it doesn't agree to a trade deal.

Beijing announced late Monday that it would raise tariffs on $60 billion worth of USA goods from June 1. The list of targeted goods ranges from TV cameras to tequila, and includes a range of agricultural products. China responded with a plan to increase tariffs on $60 billion in USA exports.

The Dow Jones Industrial Average lost more than 2% of its value, dropping by over 617 points to close at 25,324.99, with poor performance from stocks for companies such as Boeing and Apple, which rely on Chinese trade. The Nasdaq dropped 3.4%, its biggest one-day loss of 2019.

Trump, however, is still dangling the prospect of higher tariffs on Chinese goods.

"As soon as he sent out the tweet that he's not that concerned about the dispute at this point gave the market an element of relief rally", said Sid Mokhtari, executive director of institutional equity research at CIBC.

Senate Majority Leader Mitch McConnell said on Tuesday that "nobody wins a trade war" but he hoped Trump's tactics in negotiations China would put the United States in a better position to move talks forward with Beijing.

"We can make a deal with China tomorrow, before their companies start leaving so as not to lose United States of America business, but the last time we were close they wanted to renegotiated the deal". 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.

"When the time is right we will make a deal with China", Trump said. The red portion on US tariff levels represents new tariffs that President Trump already put into place in 2018.

Last year, Beijing imposed tariffs on imports of USA agricultural goods, including soybeans, grain sorghum and pork as retribution for U.S. levies.

Related:

Comments

Latest news

Barr taps U.S. attorney in CT to review origins of Russian Federation probe
Attorney General William Barr speaks during a farewell ceremony for Deputy Attorney General Rod Rosenstein at the U.S. The Durham inquiry is separate from an investigation by the Justice Department's Inspector General.

Barr Orders Connecticut Prosecutor to Investigate Mueller Probe
Meanwhile, the attorney general has continued to keep his promise to investigate the investigators . Attorney by Trump in late 2017 and confirmed in 2018, has prior experience as a special prosecutor.

Baytown officer fatally shot woman at apartment complex
Police said as the officer has handcuffing the woman, she was able to grab the Taser away from the officer and tased him. In the video, the officer can be seen running and approaching the attacker as he tells him to "put the knife down, dude".

Meghan reveals baby Archie's feet in US Mother's Day celebration
Markle probably had a great first Mother's Day , and it was nice that she shared a post featuring Archie for followers to enjoy. Meghan Markle , the Duchess of Sussex, celebrated her first Mother's Day Sunday, six days after giving birth .

Mr. Ratburn of 'Arthur' Is Gay and Social Media Is Obsessed
Ratburn is actually gay! He appears to be an aardvark , just like the show's main character. To really jump-start the new season, the series launched the first episode with Mr.

Kim Kardashian Fourth Baby Name Theories
Kim shared a throwback post on Twitter to her CBD themed baby shower that had the teddy bear accompany the string of photos. She added: "He's also Chicago's twin, I'm sure he will change a lot but now he looks just like her".

Elon Musk offers glimpse of SpaceX's internet satellites
SpaceX is another step closer to launching satellites into the atmosphere to provide the world with widespread internet coverage . The Federal Communications Commission has issued SpaceX permission to launch two groups of satellites for the Starlink project.

Hamilton back on top with win in Spain
His team mate Lando Norris brought out the safety vehicle on lap 46 after colliding with Racing Point's Lance Stroll. The race start saw a three-way battle between pole-sitter Bottas, Hamilton and Sebastian Vettel .

Tim Conway, Beloved Comedian From 'The Carol Burnett Show,' Dead at 85
He starred in live-action Disney movies, including The Apple Dumpling Gang with Don Knotts and The Shaggy D.A. Conway was born on December 15, 1933, just outside of Cleveland, Ohio, in nearby Willoughby, Illinois.

Close Friend Patrice Evra Has Say On Paul Pogba's Man Utd Future
Pogba meanwhile receives a reported £50,000 bonus for every goal he scores and £20,000 for every assist. I remember losing 4-1 at home to Liverpool and they were still singing.

Disney strikes deal with Comcast, takes full control of Hulu
Disney has guaranteed a sale price for Comcast that represents a minimum total equity value for Hulu of $27.5 billion. Comcast acquired NBCUniversal back in 2011 with a consent decree that it wouldn't have a say in Hulu's direction.

Jonas Brothers Return To 'SNL' With A Throwback Hit, Acting Cameo & More
Suffice it to say, they weren't really able to resolve much of anything when it comes to their cases. This weekend's edition of " Saturday Night Live " did not perform as well as last week's broadcast.

North Korea demands return of US-seized cargo ship
The Trump administration announced that it would seize the ship hours after North Korea fired short-range missiles on Thursday. United States officials said the North Korean vessel - known as the "Wise Honest" - was being impounded to American Samoa.

Amazon offers employees thousands of pounds to set up delivery firms
One of them is run by Milton Collier, a freight broker who started his business in Atlanta about eight months ago. Collier says his business is already preparing for the one-day shipping goal by looking for more workers.

Explorer dives to deepest point in the ocean, stunned to find plastic
The dive was the first for The Five Deeps Expedition, funded by Vescovo, and is being filmed for a Discovery Channel documentary. Once at the bottom, he explored the seafloor for four hours in his submersible, The Limiting Factor , according to CNN .

Other news