US stocks sink as Trump takes aim at 'unfair' World Trade Organisation for giving China 'tremendous perks'

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Donald Trump said China's retaliation was "unfair"
  • Dow Jones tumbles as much as 2.5pc after Trump attacks WTO
  • Trump: WTO gives China competitive advantage by considering it a developing nation
  • China warns it is ready to pay "any cost" after Trump threatens to escalate trade skirmish
  • Trump suggests a further $100bn of tariffs on Chinese goods
  • Trump: new measures would counter Beijing's "unfair retaliation" 
  • Markets slip back on fears of trade war
  • FTSE 100 struggles to pull out of the red
  • China stands ready to work with the world to protect intellectual property rights
  • It is a golden age for trade. What are you waiting for?
  • World economy slows abruptly as credit squeeze builds

Donald Trump has attacked the "unfair" World Trade Organisation for giving China "tremendous perks and advantages" as the war of words over import tariffs continued to escalate.

Stocks were put under renewed pressure by the US President tweeting that the international trade body helps China by considering it "a developing nation", giving it a competitive advantage over its trading partners. 

China warned this morning that it is ready to pay “any cost” to protect itself in a full-blown trade war after Donald Trump threatened to slap a further $100bn of tariffs on Chinese goods.

US President upped the ante overnight in the tit-for-tat tariff exchange between the world's two largest economies by vowing to counter Beijing’s “unfair retaliation”. Markets already reeling from Mr Trump’s plans to correct the US’s trade imbalance with China were knocked by the latest escalation.

Mr Trump admitted in a radio interview that a trade war could cause "a little pain" but believes that the US will eventually be better off by trying to disrupt the current trade balance.

European equities struggled to pull out of the red while US markets plunged in late trade on Friday. 

                                                                                                    

Market wrap: US stocks close in the red

Stocks tumbled on Friday evening, bringing to a close a week which saw financial markets rattled by the potential for a trade war between the US and China. 

The benchmark Dow Jones closed down 572 points, or 2.3pc, paring some of its losses in the last hour of trading having plunged more than 700 points at one point. All 30 stocks in the Dow ended the day lower. 

The S&P 500, meanwhile, ended 2.19pc, or 58 points, lower, and the Nasdaq closed down 161 points. 

The sell-off accelerated in late trade on Friday, on a speech by Jerome Powell, the Fed chairman.

Chad Morganlander, a portfolio manager at Washington Crossing Advisors, said: "What Powell is signaling to market participants is that the Fed is not swayed or rattled by equity market volatility at this point. That's the reason for the additional selling pressure.

"The Fed has the intestinal fortitude to wait until it creeps into credit conditions and causes financial stress."

Nasdaq dragged down by Facebook

The tech-heavy Nasdaq was pulled down on Friday by Facebook, which revealed earlier today that it had called off talks with hospitals after asking for patient medical data, amid concerns surrounding the company's handling of user data.

The Nasdaq fell 159 points on Friday late afternoon to 6,916.00.

This evening Facebook launched a renewed crackdown on foreign attempts to influence elections, promising strict controls on who can run political adverts and manage pages with large followings.

Mark Zuckerberg said the company would force pages with large followings to confirm their identity and location, an attempt to stop foreign agents peddling propaganda to influence votes.

Similar measures will apply to those who buy political or “issue-based” adverts, while the adverts themselves which will carry special labels giving users information about who has purchased them.

Read more here. 

WTO offers 'advantages' to China and is unfair to US, Trump says

China receives special treatment from the World Trade Organisation and it is unfair to the US, President Donald Trump has said on social media, raising questions about how useful the multilateral organisation will be as a tool for de-escalation in the emerging trade conflict between the two nations, write Anna Isaac and Neil Connor. 

“China, which is a great economic power, is considered a developing nation within the World Trade Organisation. They therefore get tremendous perks and advantages, especially over the US. Does anybody think this is fair. We were badly represented. The WTO is unfair to US,” Mr Trump tweeted.

China had so far positioned itself as a defender of free trade in the row, claiming that it would, as far as possible, look for resolution via the WTO, the global regulator for trade between countries.

Read the piece in full here. 

No let-up for US equities

China's 'nuclear option' is useless, but it can outwit Trump by subtler means

China’s leaders must be sorely tempted to activate the "nuclear option" and punish the capitalist running dog, the tango dancer in the White House, writes Ambrose Evans-Pritchard.

They could at any time start to liquidate their $1.2 trillion (£850bn) holdings of US Treasury debt, switching the proceeds into euro, sterling, krona, Aussie, or peso debt to stop the yuan exchange rate soaring.

Even a small dose of this financial arsenic would – in the minds of Beijing’s ultra-nationalist faction – set off a salutary panic. It would crater the US bond market at the very moment when Donald Trump’s fiscal depravity is driving the US budget deficit to a stratospheric $1 trillion.

Read the piece in full here.

US stock sell-off accelerates

The Dow Jones slipped further into the red late on Friday, down more than 600 points, or 2.5pc, at 23,892.26 while the S&P 500 fell 56 points to 2,605.89, as fears deepened over a trade war.

The decline came despite the upbeat tone of Jerome Powell's first speech as head of the Federal Reserve in which he said there would be a  “patient” approach to tightening monetary policy. 

Salman Ahmed, chief investment strategist at Lombar Odier Investment Managers, said the "increased risk of a trade war is likely to continue to weigh on performance until the uncertainty dissipates". 

Trade tensions send stocks sliding as Trump attacks WTO

Donald Trump took to Twitter to attack the WTO

Stocks have finished another rollercoaster week of trading on the slide after Donald Trump took aim at the "unfair" World Trade Organisation, claiming that it hands rival China an unfair advantage. 

Markets were rocked again by the US President threatening to impose a further $100bn of tariffs on China. Government officials in Beijing vowed to retaliate if the Trump administration published another tariff hit list with investors pulling money out of riskier equities amid the heightened tensions.

The FTSE 100 survived the latest escalation relatively unscathed, dipping just 0.2pc, but the Dow Jones in New York plunged as much as 1.9pc as investor sentiment took another downward turn.

Samsung's record-breaking profits clouded by predictions of end to chip boom

Samsung's Galaxy S9

Booming demand for Samsung’s memory chips and the success of its latest smartphone have led the Korean electronics giant to forecast record quarterly profits.

However, the company’s buoyant financials were cancelled out by warnings that the chip boom of the last 18 months is peaking, leading the company’s shares to fall slightly.

Samsung Electronics, the biggest and best known part of the Samsung corporate empire, predicted that operating profits had reached 15.6 trillion won (£10.4bn) in the first three months of 2017, up 58pc year-on-year.

Read James Titcomb's full report here

Trump attacks World Trade Organisation for giving China 'tremendous perks'

Trading in New York is quickly deteriorating after Donald Trump attacked the "unfair" World Trade Organisation for giving China "tremendous perks and advantages".

His chief economic adviser Larry Kudlow attempted to soothe the market's fears, lifting stocks away from their early lows, but Trump's tweet lambasting the WTO put equities on the back foot once again with the Dow Jones sinking to a 1.5pc loss.

Fidessa pushes vote on Temenos deal out as rivals circle

Their last-minute interest meant that the vote on the Temenos deal, originally due to take place yesterday, was put on the back-burner

City software firm Fidessa has pushed its vote on a £1.4bn takeover by Swiss group Temenos to the last possible moment while it considers potentially better offers from rivals. 

Financial technology companies SS&C Technologies and Ion Investment now have two weeks to firm up their separate bids or walk away after Fidessa said on Friday it would be voting on the Temenos move on April 27. 

A bidding war for the company, which is based in London and provides trading and infrastructure software to financial institutions, started earlier this week when it emerged that the pair were hoping to gatecrash the deal. 

Read Lucy Burton's full report here

Trade fears hit stocks in New York; US jobs report disappoints

The fresh wave of trade war jitters sweeping markets has reached stocks in New York with the Dow Jones sinking as much as 1.1pc on opening.

A mixed US jobs report has done little to lift the sour mood on markets but stocks across the Atlantic have rallied off their lowest levels.

The US labour market tightened further in March but job creation pulled back sharply from February's bumper month to 103,000, a 210,000-job drop. 

A pick-up in wage growth to 2.7pc this afternoon will bolster the case at the Federal Reserve for three interest rate rises this year, however, ING argued.

Bestway primed to save 2,000 more jobs with deal for Conviviality retail arm

Cash and carry wholesaler Bestway is understood to be closing in on a deal to buy Conviviality's retail division, which includes Bargain Booze and Wine Rack

The jobs of nearly 2,000 workers at collapsed drinks business Conviviality look set to be saved as cash and carry wholesaler Bestway prepares to snap up the fallen firm’s retail chains including Bargain Booze.

Bestway is understood to be imminently announcing the purchase of the Bargain Booze and Wine Rack chains, as well as other Conviviality businesses Select Convenience and WS Retail. Conviviality dramatically collapsed last month after failing to secure rescue funding from shareholders.

Read Bradley Gerrard's full report here

China vows to retaliate if US releases $100bn tariff hit list

China has vowed to immediately retaliate in its tit-for-tat tariff exchange with the US if the Trump administration releases a $100bn tariff hit list.

The Chinese Ministry of Commerce condemned the White House for threatening Beijing with a fresh round of tariffs and said that it has very detailed retaliatory measures lined up, according to Bloomberg.

Although there are not enough US goods arriving in China to match the US's threat of an additional $100bn in tariffs, Beijing could increase import taxes already announced or sell US government bonds to ramp up the pressure on the Trump administration.

SSE-Npower poaches new boss from Dixons Carphone

Katie Bickerstaffe, the designated chief executive of the £3bn merger of SSE and Npower 

The energy supply giant to emerge from the SSE-Npower tie-up will be spearheaded by the chief executive behind the high street mega-merger of Dixons and Carphone Warehouse.

The big six energy suppliers have poached Katie Bickerstaffe from the electrical retailer amid an exodus of top talent from Dixons Carphone to lead the new £3bn energy supplier which is expected to begin trading by early next year.

Ms Bickerstaffe, the boss of Dixons Carphone’s UK and Ireland business, will take up the post later this year. She is the first to be appointed to the board of the new venture between Npower and SSE’s retail spin-off which will supply around 11.5 million homes across the UK. She is also the first female chief executive of a major household energy supplier in the UK.

Read Jillian Ambrose's full report here

Trump: trade war could cause 'a little pain'

Donald Trump threatened to hit China with $100bn in additional tariffs

Donald Trump has admitted that a trade war could cause "a little pain" but believes that the US will be better off by trying to disrupt the current trade balance.

According to Reuters, he said in a radio interview:

"But the market has gone up 40 percent, 42 percent so we might lose a little bit of it. But we're going to have a much stronger country when we're finished.

"So we may take a hit and you know what, ultimately we're going to be much stronger for it."

Pound recovers above $1.40 against the dollar; US labour market set to tighten further

The pound has recovered to above $1.40 against the dollar after slipping yesterday on growth in the UK's crucial services sector sinking to its lowest level since the Brexit vote.

Last month's cold blast hit the sector hard but should the Bank of England be concerned about a sustained slowdown?

Capital Economics argues that growth has rebounded shortly after dipping on recent occasions and the Brexit transition deal removing economic uncertainty should also provide the economy a boost.

US labour statistics due at 1.30pm will be the next big market mover for currency traders. Economists are expecting the US labour market to have tightened further in March with unemployment set to drop to 4pc, its lowest level since 2000. And here's Donald Trump's preview of this afternoon's figures...

Noble Group's nemesis returns to warn rescue deal has ‘zero chance’

Noble Group is based in Hong Kong and listed in Singapore

Stricken commodities trader Noble Group is on the ropes once again after its nemesis, an anonymous research group named Iceberg, warned its rescue plan had “zero chance of success”.

Singapore-listed Noble, which ships metals around Asia, announced a controversial $3.5bn (£2.5bn) restructuring deal earlier this year that would hand control to some of its biggest creditors and virtually wipe out existing shareholders, leaving them with just 10pc of the company.

The plan incited fury because it would have awarded 20pc of Noble to existing management.

Read Jon Yeomans' full report here

Out of favour retailers lead the FTSE 100 lower; hopes of tariff talks fade

Marks & Spencer shares tumbled to the bottom of the FTSE 100 

Stocks in Europe are still languishing in the red with Next and Marks & Spencer dragging the FTSE 100 lower after Citigroup analysts urged investors to ditch high street stocks for their online rivals.

The latest downward turn in sentiment has been driven by dwindling hopes that "renegotiation between America and China or mediation by the World Trade Organization would heal the rift", according to Swissquote's Peter Rosenstreich.

He added that any trade skirmish is likely to knock the global economy:

"Despite President Trump’s tweet that trade wars are “good and easy to win”, this conflict is unlikely to resolve without damage. Broken trade routes threaten global growth. Weak commodity prices depend on free trade: endangering this tightens supply and drives up prices."

If JP Morgan's global PMI survey yesterday is anything to go by, growth is already slowing. Could a trade war slam the brakes on the already decelerating global economy?

Private equity firms weigh swoop for troubled retailer Homebase

Customers failed to respond to an overhaul that included rebranding stores as Bunnings

Several private equity firms are understood to be circling Homebase as the DIY chain's Australian owner Wesfarmers plots an escape from its ill-fated £340m takeover.

Hilco, Endless and Lion Capital are among the groups eyeing a potential bid, with bargain retailer B&M also weighing an approach, sources said.

It is unclear at this stage whether any bid would be for the entirety of the business, part of it, or, in B&M's case, a chunk of Homebase's store estate. 

Read the full report here

Productivity rebound continued in final quarter of 2017

The ONS has confirmed that the recovery in UK productivity continued in the fourth quarter of the year with quarterly output per hour growth climbing 0.7pc.

After declining in the first half of 2017, Britain's flagging productivity rebounded in the second half of the year, recording two consecutive quarters of growth.

The productivity crisis since the financial crisis has puzzled economists and today's rebound should be seen in the context of "a particularly poor  first half performance", argued EY ITEM Club's Howard Archer.

Job figures and Fed speech in focus on busy day for US markets

New Fed chair Jerome Powell has had to weather a storm on markets since arriving at the central bank in February

Dow Jones index futures have pulled away from their lowest levels but stocks in New York will have to ride out a busy day for US markets.  

Monthly labour statistics are expected to show the number of jobs created in the US economy slip back after a bumper February while new Federal Reserve chair Jerome Powell is scheduled to speak on the outlook for the economy this evening. What will he have made of the escalating tensions over trade between Washington and Beijing?

His short time as head of the US central bank has been a baptism of fire with markets also rocked earlier this year by fears that the Fed could tighten monetary policy quicker than markets had anticipated.

Co-op returns to profit as it bounces back from bank woes

The Co-operative Group has returned to profits

The Co-operative Group returned to profit last year as it bounced back from a massive writedown of its stake in the Co-operative Bank and cost-cutting measures began to pay off.

The mutual, which runs food shops and funeral parlours as well as offering insurance and legal services, made a pre-tax profit of £72m in the year to January 6, up from a £132m loss the year before.

Its food revenues were flat at £7bn, but rose 3.4pc on a like-for-like basis, stripping out the impact of its decision to close larger stores.

Read Jack Torrance's full report here

Beijing would have to target US government bonds to retaliate to Trump tariff threat

Beijing can't just ramp up the pressure on the White House by matching Donald Trump's threat of an extra $100bn of tariffs. 

Total US exports to China were worth just $130bn last year. China would have to slap new import taxes on all US goods arriving in the Asian powerhouse to get close to Trump's latest threat.

Rabobank suggests that China could still put the "nuclear option" of threatening to sell US Treasuries (US government bonds) on the table, however.

It added:

"This would slap the US in the face, but will also upset their own policy of Chinese renminbi stability. It would also be ‘frowned upon’ from a European or Japanese perspective as such a move cuts off all those shiny Goldilocks."

Muted market reaction to threat of tit-for-tat tariff exchange spiralling into trade war

Are investors starting to call Trump's bluff?

The reaction on markets to the threat of a further $100bn of tariffs on Chinese goods has been muted this morning.

Trump aides spent two days calming markets by suggesting that the White House was open to talks with Beijing and new chief economic adviser Larry Kudlow had called the $50bn of tariffs already announced just "proposals".

The latest threat by the US President has been taken with a hefty pinch of salt by investors but sentiment has undoubtedly been knocked by the escalation.

The DAX, Germany's blue-chip index, has been hardest hit in Europe, slipping 0.5pc, but the FTSE 100 has inched down just 0.1pc in early trading. Dow Jones index futures are indicating a sharper 0.9pc fall at the opening bell in New York this afternoon.

Agenda: Markets wobble as Trump turns up the heat on China with threat of $100bn of fresh tariffs

Donald Trump said he would counter Beijing's "unfair retaliation"

Donald Trump's threat to hit China with $100bn of additional tariffs has slammed the brakes on the global stocks rebound as rattled markets slipped back on fears of a full-blown trade war.

The escalation in the trade skirmish between the US and China cut short the market's recovery in Asian and European trading but the reaction was muted. The FTSE 100 dipped just 0.2pc on opening while the Nikkei 225 in Tokyo finished 0.4pc lower overnight.

Wall Street had started to recover from the tit-for-tat tariff exchange after the US President’s new chief economic adviser Larry Kudlow hinted that the White House was planning to pull back from the brink of a trade war.

Mr Trump put rocked markets on the back foot again by threatening to counter Beijing's "unfair retaliation" with new tariffs. China announced on Wednesday $50bn of tariffs on US goods ranging from soybeans to aircraft.

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