AP Photo/Ahn Young-joon

Morning Markets: Global stocks mostly lower as US plans tariffs on China

June 15, 2018 - 8:28 am

By YOUKYUNG LEE, AP Business Writer

SEOUL, South Korea (AP) — Global stock markets were mostly lower on Friday as U.S. President Donald Trump's approval of a plan to impose tough tariffs on China renewed concerns about trade friction.

KEEPING SCORE: Britain's FTSE 100 fell 0.7 percent to 7,707, while France's CAC 40 added 0.1 percent to 5,535. Germany's DAX edged down 0.3 percent to 13,072. Futures augured a weak start on Wall Street. S&P futures fell 0.4 percent while Dow futures dropped 0.6 percent.

TARIFFS: Trump approved a plan to impose punishing tariffs on tens of billions of dollars of Chinese goods as early as Friday. The White House has yet to release a final list of products but a tentative version in April ran the technology gamut from TVs and telecoms equipment to medications and industrial chemicals. U.S. officials say the tariff hike targets goods that might benefit from Chinese theft of technology or pressure on foreign companies to hand it over in exchange for market access.

ANALYST'S TAKE: "Ultimately a negotiated solution is likely," said Shane Oliver, head of investment strategy at AMP Capital. Even though China and the U.S. probably want to negotiate, "the risks are high and the tariffs could well be implemented before the issue is resolved."

EUROPE: The ECB on Thursday said it would phase out by the end of the year its bond-buying stimulus for the 19 countries that use the euro. It had deployed the program in 2015 to save the region from the risk of falling prices and growth. It also said it plans to hold off on raising interest rates until at least the summer of 2019, which is longer than some investors expected.

ASIA'S DAY: Asian stocks finished mixed. Japan's Nikkei 225 finished 0.5 percent higher at 22,851.75 but South Korea's Kospi retreated 0.8 percent to 2,404.04. Hong Kong's Hang Seng index declined 0.4 percent to 30,309.49 while China's Shanghai Composite Index fell 0.7 percent to 3,021.90. Australia's S&P-ASX 200 jumped 1.3 percent to 6,094.00. Stocks in Taiwan were higher, while in Indonesia markets were closed for a holiday.

CURRENCIES: The dollar was flat at 110.65 yen and the euro strengthened to $1.1591 from $1.1560.

OIL: Benchmark U.S. crude lost 20 cents to $66.69 per barrel in electronic trading on the New York Mercantile Exchange. On Thursday, it rose 25 cents to settle at $66.89 per barrel. Brent crude, the international standard, fell 92 cents to $75.02 per barrel. On Thursday, it fell 80 cents to $75.94.

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