As US Auto Tariffs Stay at a Standstill Global Stocks Rise
Global stocks gained after the US sent more conciliatory messages on trade, offsetting lackluster economic data from the world’s biggest economy. Industry sources told AFP that US President Donald Trump was planning to delay imposing tariffs on auto imports while the United States pursues agreements with key trading partners.
European and US markets that had been in negative territory suddenly jumped higher, with German auto manufacturers among those posting strong advances. US auto giants General Motors and Ford also gained.
Wall Street “has shown a propensity to bounce on any positive-sounding trade headline, and today was no different,” said Briefing.com.
The European Union is finalizing a list of American goods to target with retaliatory tariffs in the event that Trump, who is expected to make a decision by May 18, imposes levies on car imports, Bloomberg reports. https://t.co/KE8WntHl5N
— Kyle Griffin (@kylegriffin1) May 13, 2019
Adding to the market’s hopes, US Treasury Secretary Steven Mnuchin told a Senate panel that Washington was close to resolving its differences with Mexico and Canada over steel and aluminum tariffs that have created friction among the trading partners.
Mnuchin also repeated his expectation that US negotiators would return to Beijing to pursue stalled talks aimed at resolving the US-China trade war.
“These developments helped assuage investors that the US would not be distracted in its trade talks with China by also having to deal with other tariff disputes,” said Briefing.com.
The broad-based S&P 500 gained 0.6 percent, with the more hopeful tone on trade offsetting lackluster April retail sales data and weak industrial output data. Earlier, bourses in Europe and Asia pushed higher. Oil prices advanced following US data showing a drop in gasoline inventories.
The International Energy Agency confirmed that the world’s oil supply fell last month as US sanctions on Iran tightened and OPEC+ members produced less crude in line with their pact. Among individual companies, Google parent Alphabet jumped 3.9 percent, unveiling new promotional formats as it competes with Amazon and Facebook for advertising dollars. Other large tech shares were also solidly higher, including Amazon, Apple and Netflix, all of which rose more than one percent.