Thursday 23 May 2019

Markets fall as firms brace for trade war

Traders work on the floor of the New York Stock Exchange (NYSE)
Traders work on the floor of the New York Stock Exchange (NYSE)


A renewed slump in Chinese shares and a sobering set of global factory surveys sucked world markets lower yesterday, while the euro and Mexican peso were both jolted by political developments.

It was the first trading day of the new month, quarter and half-year, but there was no let-up for bruised investors after the worst start to a year for world shares since 2010.

Shanghai's bear market lurch had continued overnight, with losses of up to 3pc as firms await some $34bn (€29bn) of US tariffs this week and new business surveys showed some worrying signs of deterioration.

Europe suffered a thud too, with the Stoxx 600 share index dropping as much as 1pc and the euro down 0.5pc against the dollar as differences over immigration threatened Angela Merkel's German coalition government.

The trade strains meanwhile were compounded by an EU threat to hit the United States with almost $300bn in retaliatory tariffs, lingering concerns over US President Donald Trump's dislike for the World Trade Organisation and by data showing the weakest Eurozone manufacturing sector growth in 18 months. "There are a lot of uncertainties out there," said Rabobank's Head of Macro Strategy Elwin de Groot.

In Ireland, the Iseq Overall Index followed peers lower, shedding 0.8pc to 6,927.22.

Movers included gambling group Paddy Power Betfair, which declined 4pc to €91.20. Glanbia was down 1.8pc at €15.61. Ferry group Irish Continental advanced 3.5pc to €5.23.

The UK's FTSE-100 fell 1.1pc, while Germany's DAX was down 0.5pc. France's benchmark CAC-40 lost almost 0.9pc.

Irish Independent

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