Futures drop after US threatens more China tariffs
U.S. stock index futures dropped sharply on Wednesday after the United States threatened tariffs on an additional $200 billion worth of Chinese goods, dampening hopes of a compromise on trade.
China’s commerce ministry called the U.S. actions “completely unacceptable”, adding that Beijing will have to respond to the latest moves by Washington.
Most people think world is more dangerous than two years ago
Most people think the world is more dangerous today than it was two years ago as concerns rise over politically motivated violence and weapons of mass destruction, according to a survey released on Tuesday.Six out of ten respondents to the survey, commissioned by the Global Challenges Foundation, said the dangers had increased, with conflict and nuclear or chemical weapons seen as more pressing risks than population growth or climate change.The results come as NATO leaders prepare to meet in Brussels on Wednesday amid growing tensions between the United States and fellow members over defence spending, which some fear could damage morale and play into the hands of Russia.Russia accuses NATO of having bases ‘snuggled’ up to its borders”It’s clear that our current systems of global cooperation are no longer making people feel safe,” said Mats Andersson, vice chairman of the Global Challenges Foundation, in a statement.Andersson said turbulence between NATO powers and Russia, ongoing conflict in Syria, Yemen and Ukraine and nuclear tensions with North Korea and Iran were making people feel unsafe.NATO chief says despite differences, alliance ‘stronger together’A separate survey commissioned by the Global Challenges Foundation after North Korea’s leader Kim Jong Un met U.S. President Donald Trump found people were largely not reassured.Less than a third of the nearly 5,000 respondents reported feeling less concerned about weapons of mass destruction.”War is more likely,” said Dr Patricia Lewis, director of international security at the think tank Chatham House. “We have a great deal of instability and that is so often a precursor to wars.”Trump says added NATO funds not enough for US”Two large powers are disrupting the established rules. We saw the invasion of Ukraine by Russia and we see the U.S. starting a trade war, ripping up agreements which the rest of us are trying to abide by,” said Lewis.Founded to deter the Soviet threat in 1949, NATO is based on deep cooperation with the United States, which provides for Europe’s security with its nuclear and conventional arsenals.It has found renewed purpose since Russia’s 2014 annexation of Crimea, sending battalions to the Baltics and Poland to deter potential Russian incursions.Of the 1,000 people surveyed in Russia as part of the Global Challenges Foundation analysis, 91 percent thought weapons of mass destruction were the greatest risk to global insecurity.The survey findings are based on responses from more than 10,000 people in 10 countries surveyed by polling firm ComRes in April this year.The Global Challenges Foundation promotes discussion of the greatest threats to humanity – issues that could wipe out more than 10 percent of the population – in order to find solutions.
Global stocks were under pressure overnight, with Chinese markets taking the biggest hit. The Shanghai Composite index dropped 1.8 percent, while China’s blue-chip CSI300 index declined 1.7 percent.
U.S. officials on Tuesday issued a list of thousands of Chinese imports that the Trump administration wants to target with new tariffs, including hundreds of food products, as well as tobacco, chemicals, coal, steel and aluminum.
There is a two-month period of public comment on the latest proposed list before the tariffs get imposed. President Donald Trump has said he may ultimately target more than $500 billion worth of Chinese goods – roughly the total amount of U.S. imports from China last year.
India cuts Iranian oil imports in June ahead of US sanctions
Indian refiners cut imports of Iranian oil last month as they started weaning their plants off crude from the country to avoid sanctions by the United States that are set to take effect in November.India’s monthly oil imports from Iran declined to 592,800 barrels per day (bpd) in June, down 16 percent from May, according to data from industry and shipping sources.The United States in May said it would reimpose the sanctions after withdrawing from a 2015 agreement with Iran, Russia, China, France, Germany, and Britain, where Tehran agreed to curb its nuclear activities in return for the lifting of earlier sanctions.Keep calm, don’t inflame trade row with US: China to its state mediaThe government of India, Iran’s top oil client after China, asked refiners last month to prepare for drastic reductions or even zero Iranian oil imports.The first set of sanctions will take effect on Aug. 6 and the rest, notably in the petroleum sector, following a 180-day “wind-down period” ending on Nov. 4.U.S. officials said in June they would push countries to reduce their Iranian oil imports to zero. The Indian refiners will want to comply with the limits to maintain their access to the U.S. financial system.”Trump administration will push for zero crude, condensate and products exports from Iran,” said Sri Paravaikkarasu, Head of East of Suez Oil at energy consultancy FGE. “The zero tolerance policy and the pace with which it is moving no doubt concerns Iran’s current crude buyers.”‘We have issues with Russia’ Germany tells TrumpOverall, India’s oil imports in June rose 10.1 percent from a year ago to 4.82 million bpd, the data showed. Overall purchases climbed on a higher intake of crude from Mexico, the United States and Azerbaijan. Imports from other Middle East suppliers also increased.Lower purchases by private refiners dragged down India’s June imports from Iran although state refiners stepped up purchases.Sources told Reuters last month that private refiners Nayara Energy and Reliance Industries Ltd plan to halt Iranian oil imports. The two firms significantly cut their imports from Iran in June.HPCL-Mittal Energy Ltd continued to skip Iran oil imports for a second month in June, the data showed.State refiners, accounting for about 60 percent of India’s nearly 5 million bpd of refining capacity, lifted 10 percent more Iranian volumes in June compared to May, at about 454,000 bpd, the data from the sources showed. The sources declined to be identified since they are not authorized to speak to the media.On a yearly basis, India’s imports from Iran were 19.5 percent higher, the data showed.Indian state refiners had cut Iranian oil imports in the 2017/18 financial year because of a dispute over the development rights for an Iranian natural gas field.However, the state refiners raised their imports in the current fiscal year starting in April after Iran offered free shipping and an extended credit period of 60 days.For the first six months of 2018, India’s Iranian oil imports increased by 8.4 percent to 585,000 bpd.In April to June 2018, the first quarter of this fiscal year, India’s oil imports from Iran rose by about 24 percent from the previous quarter to about 647,000 bpd, the data showed.Imports by state refiners during the period more than doubled to about 413,400 bpd from 191,700 bpd, the data showed.Indian refiners will likely gain more clarity on how much the United States would like them to cut after a meeting with U.S. officials scheduled for July 16 to 17, said an official with a state-run refiner who declined to be named due to the sensitivity of the matter.
Among premarket decliners, Boeing and Caterpillar fell around 1.5 percent each and U.S. Steel 2 percent.
Intel, Broadcom, Micron Technology, AMD and Nvidia were down between 1.3 percent and 3.7 percent.
Industrial and metal companies, as well as chipmakers have been the worst hit since Trump first threatened tariffs in early March as they are largely reliant on China for businesses.
Ethiopia says re-opening roads to Eritrea’s Red Sea ports a priority
Landlocked Ethiopia wants to make the re-opening of two roads connecting it to two of Eritrea’s Red Sea ports a priority in the two nations’ reconciliation process, a government spokesman said on Wednesday.In a move that ended a 20-year military stand-off, the Horn of African neighbours agreed on Monday to open embassies, develop ports and resume flights.The historic reconciliation could transform politics and security in the volatile Horn region, which lies along one of the world’s busiest shipping routes.Ethiopian government spokesman Ahmed Shide said on Wednesday that the reopening of two critical roads leading to the ports of Assab in Eritrea’s south and Massawa in the north would benefit the whole region.”The unfolding developments will not only benefit our peoples, but the entire Horn of Africa region will be a part of these developments,” Shide was quoted as saying in an interview published on the Eritrean information ministry’s website.Turkey hails Ethiopia-Eritrea peace effortsEthiopia to roll out Eritrea deal fast to ‘make up for lost opportunities’Ethiopian Airlines says will resume flights to Eritrea’s capital AsmaraEthiopia, Eritrea agree to reopen embassiesAlso on Wednesday, Ethiopian President Abiye Ahmed’s chief of staff wrote on Twitter that Ethiopian and Eritrean passport holders would be able to travel to the other country and obtain visas on arrival.The changes are sweeping away years of hostility and raising hopes in both countries for a lucrative peace dividend.Access to the ports of Assab and Massawa could greatly help Ethiopia’s push to boost their exports and increase hard currency earnings, analysts say.The country of 100 million is heavily dependent on ports in tiny neighbour Djibouti, but since Abiy took office, has also negotiated access to a port in Sudan.
At 7:09 a.m. ET, Dow e-minis were down 198 points, or 0.79 percent. S&P 500 e-minis were down 18.25 points, or 0.65 percent and Nasdaq 100 e-minis were down 55.25 points, or 0.76 percent.
Facebook, Amazon, Apple, Netflix and Alphabet were all down about 1 percent.
U.S.-listed shares of Chinese companies also tumbled, with e-commerce giant Alibaba falling 1.7 percent, and JD.com and Baidu down 1.8 percent each.
However, TripAdvisor’s shares rose 1.9 percent after Barclays upgraded the stock to “overweight” rating.
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