FTSE 100 falls under Trump’s tariff threat and Hong Kong turmoil
US President Donald Trump’s threat to reignite his trade war with China has dragged down the FTSE 100 in early trading as another day of Hong Kong turmoil hurts global stocks.
London’s blue-chip index fell 0.4 per cent, or 28.5 points, to 7,336.9. The biggest fallers included HSBC, ITV and Prudential as UK stocks traded lower, mirroring Europe.
Read more: Trump defends his trade war with China, but says a deal is close
Trump yesterday threatened to levy even more tariffs against Chinese goods if negotiations that remain ongoing fail to produce an interim agreement.
Updating New York’s Economic Club on US trade policy, he said: “If we don’t make a deal, we’re going to substantially raise those tariffs, they are going to be raised very substantially.”
Traders were hoping that the US would freeze the next tranche of China trade tariffs, which are due to reach 15 per cent on $156bn of Chinese imports on 15 December.
FTSE 100: Top 5 fallers
|ITV||Minus 2.7 per cent||134.6p|
|DCC||Minus 2.7 per cent||6,732p|
|Prudential||Minus 2.6 per cent||1,313.5p|
|Carnival||Minus 2.5 per cent||3,167p|
|British Land||Minus 1.8 per cent||564.8p|
Read more: UK advertisers block the word ‘Trump’ from their ad campaigns
FTSE 100: Top 5 risers
|Coca-Cola HBC||3.7 per cent||2,446p|
|Hiscox||2 per cent||1,245p|
|Polymetal International||2 per cent||1,183p|
|Astrazeneca||1.3 per cent||7,369p|
|Glaxosmithkline||1.2 per cent||1,751p|
European stocks fell in reaction to Trump’s tough stance. Germany’s Dax dropped 0.4 per cent to 13,225 points, while France’s Cac slipped 0.24 per cent to 5,905 points.
They were also hit by an eruption of violence in Hong Kong this week, which continued overnight.
Protesters crowded universities overnight, turning up armed with bows and arrows. It is the latest in a series of demonstrations that have brought the city to a standstill, and comes after a man was shot and a supporter of Beijing’[s stance set alight.
The turmoil sent Hong Kong’s Hang Seng index plunging 1.8 per cent to 26,571 overnight while Japan’s Nikkei dropped 0.85 per cent.
Neil Wilson, chief market analyst of Markets.com, said: “Mixed messages on trade from Trump and ongoing fears about the seemingly uncontrollable situation in Hong Kong has left Asian equines shaken.
Read more: A US-China trade deal hangs in the balance
“Hong Kong dipped another two per cent, with China, Tokyo and Sydney all weaker. Hong Kong appears to be a city in complete chaos. One fears it could get a lot darker for the people of the city before the light emerges.
“European equity markets are taking their cue from Asia with a softer open. There are jitters again like we saw on Monday morning.”
Main image credit: Getty Images