Stocks, dollar decline as Trump ups steel tariffs / Photo: SAUL LOEB - AFP/File
Stocks, dollar decline as Trump ups steel tariffs
Stock markets and the dollar recoiled Monday after President Donald Trump announced he would double US tariffs on global steel and aluminium, and accused China of violating a deal to slash tit-for-tat levies.
Oil prices surged after OPEC and other key producers decided at the weekend to hike output for July -- but by less than expected.
Geopolitical fears also ramped up after Ukraine hit air bases deep inside major crude producer Russia, raising concerns over an escalation of the three-year war.
"Trump's pledge to double steel and aluminium import tariffs have caused fresh uncertainty, especially with the European Union vowing to retaliate against the measures," noted Susannah Streeter, head of money and markets at Hargreaves Lansdown.
"Negotiations between the US and China also appear to be in disarray after China."
Trump wrote in a Truth Social post that the elevated 50-percent rate on steel and aluminum would begin Wednesday.
The Hong Kong and Tokyo stock markets both ended with sizeable losses Monday. Shanghai was shut for a Chinese public holiday.
Eurozone stock markets were lower in midday deals, with eyes also on the European Central Bank, which is expected deliver a seventh-straight cut to interest rates on Thursday.
London's benchmark FTSE 100 index was flat nearing the half-way stage, with traders betting that the UK, which recently struck a trade agreement with the United States, may avoid the latest levy hike.
The European Union on Saturday said it "strongly regrets" the tariffs move by Trump, warning it "undermines ongoing efforts to reach a negotiated solution" with the United States.
The EU added it stood "ready" to retaliate.
China on Monday said it "firmly rejects" US claims that it had violated a sweeping tariffs deal, as tensions between the two economic superpowers showed signs of ratcheting back up.
Beijing and Washington last month agreed to slash staggeringly high tariffs on each other for 90 days after talks between top officials in Geneva.
But top US officials last week accused China of violating the deal, with Commerce Secretary Howard Lutnick saying Beijing was "slow-rolling" the agreement in comments to "Fox News Sunday".
Kai Wang, Asia equity market strategist at Morningstar, warned that markets risked "greater volatility given the heightened uncertainty with regard to global growth".
Airlines on Monday revised down their traffic and profit forecasts for 2025, citing "headwinds" for the global economy, with industry chiefs warning of the risk of increased tariffs impacting the sector.
The International Air Transport Association estimates fewer than five billion air journeys will take place this year, compared with the previously forecast 5.22 billion.
- Key figures at around 1045 GMT -
Paris - CAC 40: DOWN 0.7 percent at 7,696.95
Frankfurt - DAX: DOWN 0.6 percent at 23,864.11
London - FTSE 100: FLAT at 8,773.01 points
Tokyo - Nikkei 225: DOWN 1.3 percent at 37,470.67 (close)
Hong Kong - Hang Seng Index: DOWN 0.6 percent at 23,157.97 (close)
Shanghai - Composite: Closed for a holiday
New York - Dow: UP 0.1 percent at 42,270.07 (close)
Euro/dollar: UP at $1.1420 from $1.1349 on Friday
Pound/dollar: UP at $1.3537 from $1.3463
Dollar/yen: DOWN at 142.85 yen from 143.97 yen
Euro/pound: UP at 84.37 pence from 84.30 pence
Brent North Sea Crude: UP 3.7 percent at $65.10 per barrel
West Texas Intermediate: UP 4.1 percent at $63.28 per barrel
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J.Lubrano--PV
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