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Markets Fall as US-China Trade Optimism Fades | Euro Retail Data Due

Published May 6, 2019
  • President Trump has placed trade negotiations between the US and China at risk over a series of tweets that threatened the increase of tariffs on $200 billion of Chinese imports. This was followed by Foreign Ministry officials in Beijing stating that it is unclear whether China would be willing to negotiate under these circumstances.
  • Markets have reacted accordingly to the most recent impasse in the US-China trade dispute. The Shanghai Composite Index tumbled 5% overnight, while the regional MSCI Asia Pacific Index dropped 1%. West Texas Intermediate fell to a new five-week low, as volatility soars across most assets. In Europe, the Stoxx 600 Index slid 1.6% in early trading, with S&P futures pointing towards a 2% drop at the open.
  • The US continued its escalation of tensions in the Middle East as a US aircraft has been recently deployed to the region to counter any Iranian hostilities. This comes less than a week after the US allowed Iran export waivers to expire.
  • The euro is trading steadily against the US dollar early this morning at 1.119, as market participants examine the latest business surveys from around the region, specifically retail sales data. Seasonally adjusted volume of retail trade remained somewhat unchanged in Europe, increasing by just 0.3%.