European shares seen opening lower on US-China trade worries
European shares may drift lower at open on Thursday amid reports the Trump administration is mulling raising tariffs on Chinese goods.
A spokesperson for China’s Foreign Ministry accused the US of “blackmail” and warning of inevitable countermeasures if the US takes further escalatory steps.
Asian markets fell broadly on renewed worries about a US-China trade war and on rising bond yields after the Federal Reserve signalled it stayed on course to increase borrowing costs in September and likely again in December.
The dollar edged lower against the Japanese yen while oil prices steadied after having fallen sharply to hit two-week lows on Wednesday on data showing an unexpected weekly increase in US crude oil inventories.
The Bank of England is widely expected to raise rates by 25 basis points later today despite the Brexit risks and significant changes in the external environment.
The monetary policy decision will be accompanied by the publication of quarterly inflation report. The US Labor Department’s closely watched jobs report is due on Friday, and is predicted to show improvement in employment and wage growth.
Overnight, US stocks ended mixed as the Federal Reserve signaled another imminent rate increase and reports suggested the Trump administration is considering raising the proposed tariff on USD200 billion worth of Chinese imports to 25% from the 10%.
On the data front, private payrolls figures topped analyst estimates while manufacturing activity lost momentum in July.
The Dow slid 0.3% and the S&P 500 edged down 0.1% while the tech-heavy Nasdaq Composite rose half a percent following positive results from Apple.
European markets ended Wednesday’s session on a downbeat note amid an intensifying trade conflict between the US and China.
The pan-European Stoxx Europe 600 index shed half a percent. The German DAX dropped half a percent, France’s CAC 40 index slipped 0.2% and the UK’s FTSE 100 tumbled 1.2%.
Source: London Stock Exchange – European shares seen opening lower on US-China trade worries
