World stocks fall as US announces steep tariffs

LONDON: World stocks fell today as harsh US steel and aluminium tariffs sparked renewed fears of a global trade war.

Washington said it will impose the tariffs on steel and aluminum imports from the European Union, Canada, Mexico at midnight.

The announcement prompted an immediate European threat of retaliation, with EU chief Jean-Claude Juncker saying “counter-balancing measures” would be announced within hours.

New York stocks extended opening losses after Commerce Secretary Wilbur Ross announced the tariffs. European key markets also fell, having earlier been on the path to recovery as investors took a more sanguine view of an ongoing political crisis in Italy.

The euro reversed earlier gains as inflation in the eurozone rose to the ECB’s target in May, fuelled by a huge increase in oil prices as the US decided to pull out of a nuclear deal with Iran.

Asian equities bounced back from Wednesday’s mauling as fears of turmoil in Italy were soothed by conciliatory noises from the country’s two biggest populist parties.

“Fears over an Italian snap election have receded,” noted Joshua Mahony, market analyst at IG traders.

M M Alam

M. M. Alam is a Pakistan-based working journalist since 1981. Karachi University faculty gold medalist Alam began his career four decades ago by writing for Dawn, Pakistan’s highest circulating English daily. He has worked for region’s leading publications, global aviation periodicals including Rotors (of USA) and vetted New York Times as permanent employee of daily Express Tribune. Alam regularly covers international aviation and defense-related events including Salon Du Bourget (France), Farnborough (United Kingdom), Dubai (UAE). Alam has reported thousands of events and interviewed hundreds of people in Pakistan, UAE, EU, UK and USA. Being Francophone Alam also coordinates with a number of French publications.