Shares slide on business concerns, oil gives up some gains

TOKYO (Reuters) – World stock prices fell on Monday because of escalating trade tensions between the United States and the major economies, while crude oil prices have dropped the significant gains made after the 39, modest increase in production.

European equities, which hit lows of several weeks last week, are expected to continue to fall, as financial spreads predict that the UK FTSE and the German DAX .GDAXI would open 0.5% lower and that the French CAC .FCHI would fall by 0.6%.

In Asia, the S & P500 ESc1 mini-futures contract eased 0.6% while the MSCI's broader Asia Pacific index outside Japan .MIAPJ0000PUS dropped 0, 95% to 6 12 months low. Japan's Nikkei .N225 lost 0.8%.

The Wall Street Journal reported that US President Donald Trump intends to prevent many Chinese companies from investing in US technology companies and blocking additional technology exports to China.

"Until last week, there was a vague optimism that we can muddle through this, but now, unless the United States drops its arms, things will get more and more chaotic," he said. said Hirokazu Kabeya, chief strategist at Daiwa Securities.

While the threat of a real trade war has become all the more real, the MSCI stock index around the world has declined in five of the last six weeks, including last week, when it dropped by one percent – its biggest weekly drop in three months.

Chinese stocks .MICN00000PUS were among the biggest losers, tumbling 3.7% last week, as Trump set fire to Beijing, threatening to hit $ 200 billion of Chinese imports with tariffs from 10%.

Policymakers in China have moved quickly to mitigate the potential negative effects of the trade dispute, the central bank announced Sunday that it would reduce by 50 basis points the amount of cash that some banks must hold as reserves.

The reduction in reserve requirements, the third by the central bank this year, has been widely anticipated by investors and aims to accelerate the pace of debt-for-equity swaps and encourage small businesses.

Despite this move, the CSI300 .CSI300 index of Chinese mainland shares lost 0.8%, coming close to its one – year low on Friday.

The index of global automakers .MIWO0AC00PUS remained weak after falling 4.7% last week,

Trump has threatened to impose a 20% rate Friday on all car imports assembled at the EU, a month after his administration launched an investigation into whether auto imports accounted for a threat to national security.

A senior European Commission official said Saturday that the European Union would react to any US initiative to raise tariffs on cars made in the bloc.

EU Exports and Imports from the United States: tmsnrt.rs/2MUPYOo

Investors and traders worry that the threat of higher US tariffs and retaliation by others could derail a rare period of synchronized global growth.

Oil prices were supported after OPEC producers and non-OPEC countries agreed to a modest increase in production next month without announcing oil prices. 39; precise objective for the increase of production.

OPEC and non-OPEC countries said in their statement that they would increase supply by returning to 100 percent compliance with previously agreed production cuts, after months of underproduction.

"In reality, there are not many countries that can increase yields, only Saudi Arabia having the capacity to increase production in a flexible way." But if the Saudis alone are strongly increasing their production, they may be hurt by some other countries, "said Tatsufumi Okoshi, Senior Commodity Economist at Nomura Securities.

US crude oil futures were trading at $ 68.36 a barrel, down 0.3 percent the day after Friday's 4.6 percent rise.

The international benchmark Brent LCOc1, however, lost 1.8% to $ 74.22 a barrel, dropping more than half of its gains on Friday.

On the forex market, the euro held steady at 1.1656 EUR = rebounding after hitting its 11-month low, at 1.1508 on Thursday.

The euro climbed Friday as traders were encouraged by improved data on regional economic growth and new assurances given by Italian politicians that their country would not leave the single currency.

Activity in Germany and France, the first two economies in the euro area, recovered in June despite trade tensions between Europe and the United States, according to data from the US. IHS Markit.

The dollar fell 0.55% to JPY = 109.38, reaching its lowest level in two weeks, with the yen firming up on worries about global trade frictions.

The Turkish lira gained up to 1.6% on the expectations of a stable government after Tayyip Erdogan and his ruling party, the AKP, won Sunday's presidential and legislative elections in Turkey.

But his victory has kept worries about inflation and the independence of the central bank, given recent comments from Erdogan suggesting he wants to take greater control of monetary policy. .

The last pound was trading at 4.5850 for a TRYTOM dollar = D3, up 1.7% from 4.66625 at the end of last week.

Bitcoin has stabilized after reaching a seven-month low over the weekend while the security of cryptocurrency trading operators has been subjected to more scrutiny.

Digital money fell to $ 5,780 and rose to 6,161 BTC = BTSP.