Markets sink as Trump hints at trade deal delay

HONG KONG: Asian investors extended a sell-off in global markets yesterday after Donald Trump poured cold water on the chances of a trade deal with China by the end of the year.

After weeks of broad optimism, and White House claims, that the economic superpowers were close to a partial agreement, the president said he could be happy to wait until after next year’s elections.

The comments, in London ahead of a tense Nato summit that has also fuelled geopolitical concerns, sent shivers through trading floors across Europe and New York, where dealers ran for the hills.

“I have no deadline,” Trump told reporters upon his arrival. “In some ways, I like the idea of waiting until after the election for the China deal.”

Investors were already on edge after the

US reimposed stiff tariffs on Argentina and Brazil citing currency manipulation, then threatened to hammer France with 100 percent levies over the country’s digital tax.

US Commerce Secretary Wilbur Ross had also warned that more tariffs on Chinese goods planned for Dec 15 would be imposed if the first phase of trade talks was not completed by then.

Observers noted that Trump has in the past made statements on the issue that he has soon rowed back on, but there is a growing concern that the next round of China levies will be imposed.

A US House of Representatives vote to toughen the US position against China over its treatment of minority Uighurs, calling for sanctions against senior officials, will likely further complicate matters. Beijing said Wednesday the bill “wantonly smears” it and that a “price must be paid” by the US.

The vote comes days after China announced retaliatory measures for Trump’s decision to sign a bill supporting Hong Kong democracy protests.

“While the trade mood music can change very quickly, events over the past 48 hours have forced a reassessment in terms of what to expect before the end of the year,” said Rodrigo Catril at National Australia Bank.

“Tariff man is back and he has brought market volatility back to life.”

Markets were down across the board in Asia yesterday.

Hong Kong, Tokyo and Sydney all lost more than 1%, while Shanghai, Mumbai, Taipei and Bangkok each shed 0.2%.

Singapore dropped 0.4%, Seoul fell 0.7%, Manila slipped 0.5% and Jakarta sank 0.3%. – AFP