ibusinesslines.com September 21, 2018

USA tech firms bemoan impact of Trump trade tariffs

10 September 2018, 05:38 | Kelvin Horton

China's trade surplus with US widens to recordMore

China's trade surplus with US widens to recordMore

Japan's Nikkei, which had opened lower, ended 0.3 percent higher after revised second-quarter gross domestic product data showed the world's third-biggest economy grew at its fastest pace since 2016. Such a step would significantly escalate his trade war with Beijing and would likely increase costs for a broad range of US businesses and consumers. Yes, it's misleading to say that the tariffs are being imposed "on China"-tariffs are import taxes paid by consumers, not by foreign producers-but being upfront about how tariffs will increase prices for Americans is a marked improvement over his months of denials, let alone his claim that "tariffs are the greatest".

Hong Kong stocks suffered the sharpest losses, falling 1.3 per cent, while Shanghai ended down 1.2 per cent with news that China's trade surplus with the United States hit a record in August - adding to concerns Trump will push ahead with the tariffs.

The tariffs are top of mind for Apple chief executive Tim Cook, who has personally lobbied Trump for months on issues of taxes and trade, even dining with the president and first lady Melania Trump at Trump National Golf Course in Bedminster, New Jersey, last month.

The tariffs, ranging from 5 percent to 25 percent, would apply to 5,207 products, and US actions will determine whether China adopts the additional duties, Beijing said at the time.

Ford has already announced it will eventually stop selling all passenger cars in the US except the Mustang, in favour of meeting Americans' appetite for large - and profitable - trucks and SUVs.

"Many EMs have broken ranges to trade at historically weak levels and investors will continue to monitor the sector closely with contagion fears still a major concern".

One interesting detail in that Marketplace report: Cheap Chinese labor, contrary to popular opinion, is not the source of most of the savings achieved by building iPhones in China.

Chinese trade data released on Saturday could give Trump more reason to turn up the heat. The economy added a strong 201,000 jobs and the unemployment rate stayed at 3.9 per cent, near an 18-year low.

Investors will next focus on US inflation for August due Thursday and a stronger number could once again send the dollar surging. The currency fell 1.3 percent on Friday and was last at US$0.7107.

"The days of the US being ripped-off by other nations is OVER!" Brent crude futures added 48 cents to US$77.31 a barrel.

Spot gold was a tad softer at $1,193.01.

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