Trade war concerns and uncertainty dominate on Wall Street

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The stock exchanges in New York closed on Friday with red numbers. The increasing trade conflict between China and the United States remained above the market. This time Beijing is the side that increases the pressure. The news that Washington is going to scrap steel taxes for Canada and Mexico offered insufficient counterbalance.

The Dow-Jones index ended 0.4 percent lower at 25,764.00 points. The broad S&P 500 fell 0.6 percent to 2859.52 points and the Nasdaq technology exchange lost 1 percent to 7816.28 points.

According to Chinese reports, the US spoils the atmosphere of trade talks. Investors were recently reassured by reports that US finance minister Steven Mnuchin would be traveling to Beijing in the near future for further consultation.

On the business front, the manufacturer of agricultural machinery Deere recorded a lower than expected quarterly profit. The company is no longer “cautiously optimistic” about the future. One of the reasons is that the farmers seem to postpone large purchases more often partly due to the trade war. The Deere share lost 7.7 percent in value.

Stock market novice Pinterest fell 13.5 percent. The company behind the digital bulletin board came up with numbers for the first time since its debut on Wall Street. They were much worse than expected.

In addition, Luckin Coffee, Starbucks’ Chinese counterpart, made its debut on Wall Street and jumped nearly 20 percent up. The company, founded in 2017 and now offering coffee at more than 2,000 locations, raised $ 561 million with its IPO.

On the macroeconomic front, the University of Michigan released its US consumer confidence index in May. This indicator climbed to the highest level since 2004, thanks to optimism about the economy and low unemployment. The researchers warn that the escalating trade war between China and the US can undermine consumer confidence.

The euro was 1.1160 dollars against 1.1163 dollars in Europe. The price of a barrel of American oil fell 0.3 percent to $ 62.72. Brent oil fell 0.7 percent to $ 72.08 per barrel.

About the author

Oliver I. Kjeldsen

Oliver I. Kjeldsen has a corporate finance and extensive expertise in company audit. He grants us amazing insights on taxation, international affairs and friendly advice on nearly any topic of interest. His email is [email protected]

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