Asian stocks rebound as US tariffs on China take effect

Lloyd Doyle
July 9, 2018

Asian stocks were mostly lower Friday as investors braced for the implementation of USA tariffs on Chinese imports at midnight Washington time, and likely similar measures by Beijing on US exports.

Tokyo stocks led the gains, closing 1.1 percent higher, with markets in Shanghai and Hong Kong up by around half a percentage point.

After falling as much as almost 1 percent, China's Shanghai Composite Index finished 0.5 percent higher at 2,747.23.

"The market actually is acting very calmly", said Francis Lun, chief executive of GEO Securities Hong Kong.

Trump has threatened to impose tariffs on some $450 billion of Chinese goods - virtually all of China's exports to the U.S. - as he seeks to advance his "America First" protectionist agenda. Germany's DAX gained less than 0.1 percent to 12,472.

"The Chinese side, having vowed not to fire the first shot, is forced to stage counter-attacks to protect the core national interests and interests of its people", a Ministry of Commerce spokesperson said after the tariffs were imposed.

"The Trump administrations trade war is finally upon us", said Stephen Innes, Asia-Pacific head of trading at OANDA.

Beijing has vowed to immediately respond with an equal amount of tariffs of its own against USA autos, agricultural and other products, though it is unclear how swiftly the actions could escalate into an all-out trade war. Upbeat U.S. economic data helped as reports showed U.S. service firms expanding at a surprisingly strong pace in June. Australia's S&P-ASX 200 rose 0.9 percent to 6,272.30.

Global stock markets moved in fits and starts this week in anticipation of the US-China trade war, but trader optimism lifted stocks in key markets.

In the eurozone, Frankfurt won 0.3 percent and Paris added 0.4 percent. The Russell 2000 index of smaller-company stocks picked up 1.1 percent to 1,679.48.

Benchmark U.S. crude added 9 cents to $73.03 per barrel in electronic trading on the New York Mercantile Exchange. The contract fell $1.20 on Thursday. Brent crude, used to price worldwide oils, lost 14 cents to $77.25 per barrel in London.

The dollar was roughly flat at 110.61 yen while the euro rose to $1.1717 from $1.1691.

Other reports by Iphone Fresh

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