Business

Panic Monday sparks global sell-off

Published

1 month ago

April 7, 2025

admin

FRANKFURT, April 7, (AP): Global stock markets extended a severe plunge Monday, fueled by fears that U.S. tariffs would lead to a global economic slowdown. European and Asian shares saw dramatic losses, the leading U.S. index flirted with bear market territory in pre-market trading, and oil prices sagged. The massive sell-off in riskier assets at the start of the trading week follows President Donald Trump’s announcement of sharply higher U.S. import taxes and retaliation from China that saw markets fall sharply Thursday and Friday. Tokyo’s Nikkei 225 index lost nearly 8% shortly after the market opened and futures trading for the benchmark was briefly suspended. It closed down 7.8% at 31,136.58. European shares followed Asian markets lower, led by Germany’s DAX index, which briefly fell more than 10% at the open on the Frankfurt exchange, but recovered some ground to move down 5.8% in morning trading.

In Paris, the CAC 40 shed 5.8%, while Britain’s FTSE 100 lost 4.9% in the European morning. U.S. futures signaled further weakness ahead. For the S&P 500, they lost 3.4%, while for the Dow Jones Industrial Average, they shed 3.1%. Futures for the Nasdaq lost 5.3%. If the pre-market futures losses materialize when the U.S. market opens, the S&P 500 will enter bear market territory – defined as a fall of more than 20% from the peak. The index was off 17.4% as of the end of last week. On Friday, the worst market crisis since the COVID-19 pandemic shifted into a higher gear as the S&P 500 plummeted 6% and the Dow plunged 5.5%. The Nasdaq composite dropped 3.8%.

“There’s no sign yet that markets are finding a bottom and beginning to stabilize,” wrote Deutsche Bank analysts in a research note. Late Sunday, Trump reiterated his resolve on his decision to introduce tariffs of 10% to 50% on goods imported into the U.S., a move seen as massively disrupting world trade and supply chains across borders. Speaking to reporters aboard Air Force One, he said he didn’t want global markets to fall, but also that he wasn’t concerned about the massive sell-offs, adding, “sometimes you have to take medicine to fix something.” Heavy selling kicked in after China on Friday matched Trump’s tariff, upping the stakes in a trade war that many fear could end in a global recession.

Even a better-than-expected report on the U.S. job market, usually the economic highlight of each month, wasn’t enough to stop the slide. “The idea that there’s so much uncertainty going forward about how these tariffs are going to play out, that’s what’s really driving this plummet in the stock prices,” said Rintaro Nishimura, an associate at the Asia Group. Chinese markets often don’t follow global trends, but they also tumbled. Hong Kong’s Hang Seng dropped 13.2% to 19,828.30, while the Shanghai Composite index lost 7.3% to 3,096.58. In Taiwan, the Taiex plummeted 9.7%. South Korea’s Kospi lost 5.6% to 2,328.20, while Australia’s S&P/ASX 200 lost 4.2% to 7,343.30, recovering from a loss of more than 6%. Asian economies are heavily exposed to Trump’s tariffs since they are dependent on exports, and a large share go to the United States. “Beyond the market meltdown, the bigger concern is the impact and potential crises for small and trade-dependent economies, so it’s crucial to see whether Trump will reach deals with most countries soon, at least partially,” said Gary Ng of Nataxis. Oil prices also sank further, with U.S. benchmark crude down $2.30 to $59.69 per barrel. Brent crude, the international standard, gave up $2.33 to $63.25 a barrel. As with the larger sell-off, the drop was fueled by fears that the tariffs would slow economic growth. That would hit demand for fuel, and the drop comes after moves to increase production by the OPEC+ producers’ alliance. Exchange rates also gyrated. The U.S. dollar fell to 146.24 Japanese yen from 146.94 yen. The yen is often viewed as a safe haven in times of turmoil.

The euro rose 0.3% to $1.0992. Nathan Thooft, chief investment officer and senior portfolio manager at Manulife Investment Management, said more countries are likely to respond to the U.S. with retaliatory tariffs. Given the large number of countries involved, “it will take a considerable amount of time in our view to work through the various negotiations that are likely to happen.” “Ultimately, our take is market uncertainly and volatility are likely to persist for some time,” he said. The Federal Reserve could cushion the blow of tariffs on the U.S. economy by cutting interest rates. That can encourage companies and households to borrow and spend. But Fed Chair Jerome Powell said Friday that the higher tariffs could drive up expectations for inflation and lower rates could fuel still more price increases. Much will depend on how long Trump’s tariffs stick and how other countries react. Some investors are holding onto hope he will lower the tariffs after negotiating “wins” from other countries. Stuart Kaiser, head of U.S. equity strategy at Citi, wrote in a note to clients that earnings estimates and stock values still don’t reflect the full potential impact of the trade war. “There is ample space to the downside despite the large pullback,” he said.

Related Topics:global Monday Panic selloff Sparks

Up Next

China says it will ‘fight to the end’ after Trump’s fresh tariff warning

Don't Miss

KIB warns of fraudulent schemes targeting users of the WAMD service

Click to comment

Business

US-China deal to slash tariffs also eases burden on cheap packages

Published

1 hour ago

May 14, 2025

admin

US Trade Representative Jamieson Greer, (left), and US Secretary of the Treasury Scott Bessent take part in a press conference after two days of closed-door discussions on trade between the United States and China, in Geneva, Switzerland, on May 12. (AP)

WASHINGTON, May 14, (AP): Online shoppers in the US will see a price break on their purchases valued at less than $800 and shipped from China after the Trump administration reached a truce with Beijing over sky-high tariffs. An executive order Monday from President Donald Trump said the tariffs on low-value parcels originating from China and coming through the US Postal Service will be lowered to 54%, down from 120%.

It also says a per-package flat rate – as an alternative to the value-based tariff – will be kept at $100, rather than being raised to $200 on June 1 as previously decreed. Packages shipped by commercial carriers are subject to the general tariff, which also has been cut. The new rules go into effect Wednesday.

They are part of a broader agreement by the Trump administration to drastically lower import taxes on all Chinese goods from 145% to 30% following weekend talks in Switzerland with Chinese officials. China issued a public notice on Tuesday lowering its own tariffs on US goods to 10%, down from 125%. However, the reductions are temporary, allowing the two sides to negotiate a longer-term deal in the next 90 days.

Izzy Rosenzweig, founder and CEO of the logistic company Portless, said US brands are “very excited” about the broader tariff cut. The import tax is still high, but not as prohibitive as when it was 145%, which amounted to a trade embargo. On the low-value shipments, online purchases had been coming into the US duty-free for several years under the de minimis rule, which exempted them from the import tax.

Popular shopping sites such as Shein and Temu that offer ultra-low prices took advantage of the duty-free rule by shipping directly from China to US buyers, bypassing more cumbersome customs paperwork. President Donald Trump terminated the exemption on such parcels originating from China and Hong Kong on May 2, following criticism that it not only resulted in lost tariff revenue but also allowed illicit drugs and unsafe products to flow into the US without adequate scrutiny.

US Customs and Border Protection said as many as 4 million low-value parcels were coming into the US every day – many of which originated from China. Shortly before the exemption ended on May 2, prices on many items sold by Shein rose. Temu apparently halted shipments from China and tapped its existing inventory in the US.

Business

Significant increase in Kuwait exports to the Maldives

Published

14 hours ago

May 13, 2025

admin

Significant increase in Kuwait exports to the Maldives

KCCI team meets the delegation from Maldives

KUWAIT CITY, May 13: Kuwait Chamber of Commerce and Industry (KCCI) received a delegation from the Republic of Maldives, led by the Minister of Foreign Affairs Dr. Abdulla Khalil on Tuesday, May 13 in the presence of several Kuwaiti business owners. According to a press release issued by KCCI, the meeting began with KCCI expressing its appreciation for the delegation’s visit, as it underscores the growing ties between Kuwait and the Maldives, founded on friendship, mutual respect, and shared aspirations for economic and cultural cooperation. It explained that the trade relations between the two countries have significantly strengthened over the past decade, with a notable increase in Kuwaiti exports to the Maldives.

The partnership between the two countries is further strengthened by their distinct strengths, particularly the excellence of Maldivian companies in the tourism and maritime industries, which attract the interest of Kuwaiti investors. At the same time, Kuwaiti companies excel in sectors such as finance, logistics, healthcare, and energy, providing a solid foundation for productive cooperation and investment. Meanwhile, Maldives Foreign Minister Dr. Abdulla Khalil outlined the most prominent investment opportunities available in his country, mainly in sectors such as tourism, investment, alternative energy, logistics, ports, housing cities, agriculture, and fisheries.

Business

Kuwait, Hong Kong boost ties with investment MoUs

Published

17 hours ago

May 13, 2025

admin

Kuwait, Hong Kong boost ties with investment MoUs

Kuwait’s Acting Prime Minister during the signing of MoUs between Kuwait and Hong Kong.

Kuwait Acting Prime Minister Sheikh Fahad Yousef Saud Al-Sabah on Tuesday held official round table discussions with Chief Executive of the Hong Kong Special Administrative Region John Lee Ka-chiu at Bayan Palace. During the session, they reviewed the bilateral ties and ways to boost them, in addition to exchanging visions and opinions on regional and international issues of common interest. Following the official talks, the two sides signed a Memorandum of Understanding in direct investment promotion, inked on the Kuwaiti side by Director General of Kuwait Direct Investment Promotion Authority Sheikh Dr. Meshal Jaber Al-Ahmad Al-Sabah and on behalf of the Government of Hong Kong the Acting Assistant Director General for Investment Promotion Loretta Lee. The two sides also signed a Memorandum of Understanding in the field of direct investment promotion between Kuwait Direct Investment Promotion Authority and the Hong Kong Trade Development Council (HKTDC).

The MoU was signed on the Kuwaiti side by Director General of Kuwait Direct Investment Promotion Authority Sheikh Dr. Meshal Jaber Al-Ahmad Al-Sabah and on behalf of the Government of Hong Kong by Executive Director of the HKTDC Margaret Fong. The meeting was attended by senior Kuwaiti officials including Minister of Foreign Affairs, Minister of Public Works and Minister of Commerce and Industry. The Acting Prime Minister hosted an official luncheon in honor of the Chief Executive of the Hong Kong Special Administrative Region and his accompanying delegation. (KUNA)