[ad_1]
President Donald Trump announced on Friday that he was preparing to impose tariffs on imports of more than $ 500 billion from China. Customs duties on the next $ 200 billion of Chinese imports will "very soon according to what will happen" in a major escalation of the trade war in China, he told reporters.
X
After that, Trump said that tariffs on an additional $ 267 billion in Chinese products – covering all imports – will be "ready for quick shipment".
Apple (AAPL) said in a letter to the US Trade Representative's office that Trump's threat to impose tariffs on virtually all Chinese imports would affect a wide range of its products. These products include Apple Watch, AirPods, Mac Mini and others. Apple stocks, which had been slightly higher, fell 0.8% at closing.
With the United States and China seeming far from reaching an agreement, the immediate question is how far Trump's tariffs will go. Even in June, when the United States was writing $ 50 billion in initial import tariffs, Trump claimed 10% duties on additional $ 200 billion worth of goods. Then, on August 1st, Trump carried the threat to 25%.
Impact on the stock market
The Dow Jones, S & P 500 and Nasdaq indexes, all down, have weighed on Trump's latest threats, raising fears that the world's largest economic relationship will lead to divorce. The major trading averages again sold on the Apple report. Apple's shares are members of the Dow Jones, S & P 500 and Nasdaq indices.
UBS strategists have said Wall Street would be surprised if Trump strikes immediately with the full 25 percent. They say it could trigger a market correction of 5%. A tariff of 10% would be more likely to keep the door open for negotiations.
China's trade war: Will Beijing blink?
Beijing, which had a $ 376 billion trade surplus with the United States last year, has much narrower options. The Chinese authorities have threatened to impose tariffs of 10 to 25% on additional imports of 60 billion US dollars, beyond the 50 billion already provided.
Trump seems determined to force Beijing to blink. But China sees its threats as a challenge to national honor. Beijing is already prepared for an economic blow by slowing efforts to control financial excesses. Most analysts seem to think he can manage a trade war.
Beijing could retaliate with non-tariff measures designed to harm US companies, such as encouraging boycotts or setting regulatory hurdles. This poses a risk for American multinationals like Apple, Boeing (BA), Nike (NKE) and caterpillar (CAT) with a strong exposure in China.
YOU COULD ALSO LIKE:
Wage growth finally increases, but the timing is terrible
How to trade stocks: the top software stock blinks this offensive sales signal
The Big Picture: Bears Slap Around Nasdaq, Lower Training Flea Index
IBD stock of the day: This health leader hits the point of purchase after a close negotiation
Stock Market Today: Tracking Market Trends and Best Stocks to Watch
Source link
