With little else to focus on, the markets remained gripped by the US-China trade tug of war, as Trump looks to expand the reach of his crackdown.
Reports suggest that the next few days may see the President announce a ban on companies with a least 25% Chinese ownership from hoovering up US firms in ‘industrial significant’ technological sectors like aerospace and robotics. There’s also the potential for rules going in the other direction, with restrictions on what technologies can be sold by American companies to their Chinese counterparts. A warning was also shot across the bow of Trump’s ostensible allies, as the President tweeted he is ‘insisting that all countries that have placed artificial Trade Barriers and Tariffs...remove those barriers’ if they want to avoid being met with ‘more than Reciprocity’ from the US.
Unsurprisingly the already fragile markets weren’t exactly thrilled by Trump’s determination to escalate the trade tit-for-tatting. The European markets were fairly uniform in their losses after the bell, the DAX, CAC and FTSE all falling 0.7% as the week got underway. That left the UK index under 7650, while its German sibling was sent back below 12500 and towards a fresh 2 month nadir.
As for the forex markets, the dollar continued to struggle against the yen while making up for its losses there against the pound and the euro. Cable fell 0.2%, dipping below $1.325 in the process, with the single currency shedding the same amount against the greenback to duck under $1.165.
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