Possibility of further US-China tariffs looms large

Donald Trump. Photo: Reuters
Donald Trump. Photo: Reuters
Major sharemarkets have started the week delivering mixed results, as US-China trade relations soured further after reports of more US tariffs to be announced in December.

Last week in New York the Nasdaq Composite had a correction, down more than 10% for the month, and at the close of Monday trading in the US, the benchmark S&P 500 index ended close to confirming its second correction of 2018.

On Monday, the Dow Jones Industrial Average fell 0.99%, the S&P 500 lost 0.66%, and the Nasdaq Composite dropped 1.63%.

The major US indexes pulled back steeply after a Bloomberg report said the US was preparing to announce tariffs on all remaining Chinese imports by early December, if talks next month between presidents Donald Trump and Xi Jinping faltered, Reuters reported.

Craigs Investment Partners broker Peter McIntyre said the US markets made gains on opening on Monday, but the possibility of more US-China trade tariffs, coupled with a decline in tech stocks, weighed heavier on market sentiment.

While the ASX 200 rallied to end the day up 1.11%, he said Asian markets finished the day ''mixed'', as Chinese indexes fell more than 2%.

The Shanghai Composite was down 2.18%, Shanzhen Composite was down 2.02% and Japan's Nikkei lost 0.16%.

Forsyth Barr broker Damian Foster said US stocks started well, but later fell off track.

European and UK stocks began the week in the green, the FTSE100 up 1.3%.

''Global markets entered the new week mostly in the green following one of the worst weekly performances this year,'' he said.

After the S&P 500 dropped more than 10% from its September 20 record closing high during the session, the benchmark index pared some losses late to close down 9.9% from its peak.

-Additional reporting by Reuters



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