The introduction of new duties on goods from China negatively encountered on the market
The Dow Jones index on Friday fell more than 450 points because of fears of a “trade war” between the US and China. After President trump has threatened to impose additional duties on goods from China worth $ 100 billion, and other status indicators of the securities market in the United States also showed a decline.
As reported on Friday by Reuters, citing China’s state media, Chinese authorities have promised that the initiative of the head of the White house will be met with a “violent counterattack”, stating readiness to impose new tariffs on goods produced in the United States.
“The markets are extremely sharply react to protectionism, said Reuters managing Director of investment company Sun Life Investment Management in December Mallarky. – markets are able to tolerate a small exchange of “blows”, but only in the case when there is a major increase in performance”.
The uncertainty to market participants added and mixed messages of U.S. officials. So, at the end of the week, economic Advisor to the President Larry Kudlow said in a live CNBC that he learned of a possible introduction of new tariffs in just a few hours after it publicly announced Donald trump.
After that, Kudlow told Bloomberg TV that the talks with Beijing about the fate of the tariffs has not started, but hours later changed his position, stating in the TV channel Fox that negotiations are in full swing.
According to the Vice-President of the investment Fund Charles Schwab, Randy Frederick, the market decline is due to “exclusively” with the possible retaliatory actions of the PRC.
“It is obvious that the reaction of China is the only influencing factor today on the state of the market,” he told Reuters.
Drop showed and stock index of leading industrial companies in the US. So, the Boeing company, considered the largest exporter in the Chinese market, lost the end of the week to 2.5 percent. Shares of Caterpillar fell by 2.8 percent, and the company Deere – 2.3 percent.
The decline demonstrated and high-tech corporations in the United States, more than a quarter of whose income comes from exports from China. The SOX index in assessing the state of the market for computer chips, fell to end the week 1.2 percent.