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World Shares Mostly Slip Tuesday 05/06 05:02
Shares opened mostly lower in Europe on Tuesday after a mixed session in
Asia, where Chinese markets advanced as they reopened after "Golden Week"
holidays.
(AP) -- Shares opened mostly lower in Europe on Tuesday after a mixed
session in Asia, where Chinese markets advanced as they reopened after "Golden
Week" holidays.
Germany's DAX fell 1.2% to 23,076.96, while the CAC 40 in Paris lost 0.6% to
7,682.91. Britain's FTSE 100 was unchanged at 8,596.40.
The future for the S&P 500 lost 0.7% and that for the Dow Jones Industrial
Average was 0.5% lower as investors watched to see what U.S. President Donald
Trump does with his tariff policies.
When asked at a routine briefing about comments Trump's comments on the NBC
TV network that he won't cancel tariffs on China to pave the way for trade
talks, a Chinese Foreign Ministry spokesperson reiterated Beijing's stance that
the U.S. side "should stop threatening and pressuring and engage in dialogue
with China on the basis of equality, respect, and mutual benefit."
"If they want to fight, we will fight to the end; if they want to talk, the
door is open," Lin Jian said.
Late last week, China's Commerce Ministry said it was evaluating various
U.S. missives about holding talks.
Still, Chinese markets advanced after reopening from "Golden Week" holidays.
The Shanghai Composite index added 1% to 3,311.89, while the Hang Seng in Hong
Kong was up 0.7% at 22,651.65.
A monthly survey measuring future activity in China's services sector fell
to its lowest level ever, excluding the pandemic, in a further sign the
escalation of U.S. President Donald Trump's trade war is hitting the world's
second-largest economy.
A drastic increase in tariffs on U.S. imports of Chinese products, to 145%,
has caused a sharp drop in shipping and other logistics.
"Overall optimism among Chinese firms weakened to the lowest level since
this series began in April 2012, resulting in further job cuts in April," said
the report by Caixin, a financial media group.
However, reports showed a sharp increase in tourism revenues during the
holidays that ended Monday, suggesting robust domestic demand, economists said.
Elsewhere in Asia, Australia's S&P/ASX 200 lost 0.2% to 8,148.40.
India's Sensex fell 0.2%, while Taiwan's Taiex slipped less than 0.1%. In
Indonesia, the JSX was up 1%.
Oil prices gained more than $1 early Tuesday, bouncing back from a 4-year
low following a decision by the OPEC+ group of oil producing nations to raise
their output by 411,000 barrels per day as of June 1.
U.S. benchmark crude oil picked up $1.10 to $58.23 per barrel, while Brent
crude, the international standard, surged $1.15 to $61.38 per barrel.
On Monday, the S&P 500 fell 0.6% to 5,650.38, ending a nine-day winning
streak, its longest since 2004. The Dow Jones Industrial Average declined 0.2%
and the Nasdaq composite shed 0.7%.
Berkshire Hathaway fell 5.1% after legendary investor Warren Buffett
announced he would step down as its CEO by the end of the year after six
decades at the helm. Buffett will still be its board chairman.
Markets have been absorbing the shock of tariffs and the growing trade war,
which has reignited concerns about inflation.
Such issues will overshadow the Federal Reserve's meeting on Wednesday, when
it is expected to hold its benchmark interest rate steady. The Fed cut the rate
three times in 2024 before taking a breather to watch what happens with
inflation, which has been hovering just above the Fed's target rate of 2%.
While still resilient, the U.S. economy shrank 0.3% in the first quarter,
the first drop in three years.
Ford Motor Co. said Monday it expects to take a $1.5 billion hit to its
operating profit from tariffs this year. Its shares fell 2.5% in after hours
trading.
The latest salvo in the trade war from Trump came Sunday night in a post on
his Truth Social platform. He said he has authorized a 100% tariff on movies
that are produced outside of the U.S. The impact is unclear, as it is common
for films to include production at multiple locations around the world.
Also early Tuesday, the yield on the 10-year Treasury rose to 4.36% from
4.35% late Monday.
The dollar fell to 142.96 Japanese yen from 143.70 yen. The euro was at
$1.1339, up from $1.1317.
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