Wall Street fails to rebound with Donald Trump ‘happy’ to impose tariffs on China

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Australian shares are expected to open slightly higher, despite a volatile session on Wall Street dominated by US-China trade anxiety.

Market snapshot at 8:00am (AEST):

  • ASX SPI futures +0.3pc at 6,253, ASX 200 (Wednesday’s close) -0.4pc at 6,269
  • AUD: 69.86 US cents, 53.7 British pence, 62.42 euro cents, 76.9 Japanese yen, $NZ1.06
  • US: Dow Jones flat at 25,967, S&P 500 -0.2pc at 2,879, Nasdaq -0.3pc at 7,943
  • Europe: FTSE 100 +0.2pc at 7,271, DAX +0.7pc 12,180, CAC +0.4pc at 5,418, Euro Stoxx 50 +0.5pc at 3,417
  • Commodities: Brent crude +0.6pc at $US70.28/barrel, spot gold flat at $US1,280.81/ounce

At 7:15am (AEST), ASX futures lifted 0.2 per cent, or 14 points.

The Australian dollar has fallen back to 69.86 US cents.

Meanwhile, the New York trading session ended with mixed results — with the Dow Jones index closing practically flat at 25,927 points.

In the last two days, the Dow has tumbled by more than 540 points.

The benchmark S&P 500 fell 0.2 per cent to 2,879, and the tech-heavy Nasdaq lost 0.3 per cent to 7,943.

Both the S&P and Nasdaq indices have dropped by more than 2 per cent since last week, when they were trading at record highs.

US tariffs kick in tomorrow

The Trump administration will raise tariffs on $US200 billion of Chinese goods to 25 per cent (up from 10 per cent) at 2:01pm (AEST) on Friday — right in the middle of US-Chinese trade talks.

China has announced it is sending Vice-Premier Liu He, its lead trade negotiator, to Washington for talks on Thursday and Friday (local time), which some observers have taken as a sign that Beijing wants to strike a deal.

However, US President Donald Trump said on Wednesday (local time) he would be happy to keep tariffs on Chinese imports, prompting Beijing to threaten retaliation.

Mr Trump, who has embraced largely protectionist policies as part of his “America First” agenda, warned China that it was mistaken if it hoped to delay a trade deal until a Democrat controlled the White House.

“The reason for the China pullback & attempted renegotiation of the Trade Deal is the sincere HOPE that they will be able to ‘negotiate’ with Joe Biden or one of the very weak Democrats,” Mr Trump tweeted.

“Guess what, that’s not going to happen!

“China has just informed us that they (Vice-Premier) are now coming to the US to make a deal.

“We’ll see, but I am very happy with over $100 Billion a year in Tariffs filling US coffers.”

The US and China have locked horns over trade since last year, when the Trump administration slapped levies on hundreds of billions of dollars worth of Chinese goods.

Mr Trump also demanded that China adopts policy changes that would, among other things, make its market more accessible to US companies.

Beijing has responded in kind with its own tariffs on a range of US goods including soybeans and pork products.

While expectations have mounted that the two sides appeared to be nearing a deal, relations have soured in recent days.

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