Markets: gains wiped out
China pledges action as markets plummet on Trump talk
Chinese officials responded by stating they were confident of reaching a deal with the United States. Their move may help to stabilise markets after the Dow Jones closed 800 points lower and Mr Trump warned via Twitter that tariffs would be back on the table if the talks failed to bear fruit.
“The negotiations with China have already started. Unless extended, they will end 90 days from the date of our wonderful and very warm dinner with President Xi in Argentina,” he said.
The Chinese Commerce Ministry said China would try to implement specific issues already agreed upon with Mr Trump at the G20 meeting in Buenos Aires.
In a statement the ministry said : “We are confident in implementation,” and said the talks were “very successful.”
Mr Trump responded immediately, stating: “We are either going to have a REAL DEAL with China, or no deal at all – at which point we will be charging major Tariffs against Chinese product being shipped into the United States.
“Ultimately, I believe, we will be making a deal – either now or into the future.”
Markets soared on Monday after the first signs of a truce in the war of words, but Mr Trump’s latest comments, together with recessionary warnings prompted by a narrowing of a key economic measure, reversed those gains.
Concerns about slowing US growth have accelerated the flattening of the yield curve, a phenomenon in which longer-dated debt yields fall faster than their shorter-dated counterparts.
Hong Kong’s Hang Seng retreated 1.55% and the Shanghai Composite Index slipped by 0.2%. Japan’s Nikkei was 0.8% lower.
The falls followed a 3.1% plunge in the Dow while the tech-heavy Nasdaq sank 3.8% and the S&P 500 was 3.24% lower.
Wall Street is closed today to mark the death of former US President George Busg senior.