According to a new report published by the Wall Street Journal on Monday, U.S. President Donald Trump has hinted that he may implement new tariffs on iPhones and laptop computers imported from China. The announcement came only four days before Trump is set to meet with Chinese President Xi Jinping to discuss the ongoing trade dispute between the countries. Apple stock plummeted nearly 2 percent in after-hours trading as traders expressed concern about the state of global trade.
In addition to these specific new threats, Trump has said that he plans to increase tariffs to 25 percent on $200 billion of Chinese goods, and to add more tariffs on goods that haven’t yet been taxed if a deal isn’t reached soon.
Asian stocks were mostly higher on Tuesday despite the new tariff thread, with the Shanghai Composite up 0.38 percent as of 1:46 p.m. HK/SIN and the Shenzhen Composite up 0.33 percent. Japan’s Nikkei 225 gained 0.86 percent and South Korea’s Kospi was up 0.85 percent. Only Hong Kong’s Hang Seng Index was lower, trading down 0.08 percent. The gains in Asia followed a positive day on Wall Street on Monday when the Nasdaq closed up over 2 percent, the S&P 500 ended up 1.55 percent on the day. The Dow Jones Industrial Average ended 1.46 percent higher.
Currency Movements
The dollar was trading modestly lower on Tuesday afternoon in Asia, falling against the yen and the euro to bring the dollar index down 0.08 percent to 97.00.DXY. The dollar was down 0.12 percent against the yen to 113.46 while the euro gained 0.13 percent against the greenback to $1.13248. The dollar has gained over the past two days as investors looked for on fears that the global economy is heading south.
Traders are now looking towards a speech by Federal Reserve Chairman Jerome Powell tomorrow for hints to how many more interest rate hikes will be coming in the next year.