Stock markets are firmly in the red as traders are concerned about a trade war.
Yesterday, President Trump stated he would start imposing 25% tariffs on steel imports and 10% tariffs on aluminium imports in a bid to put US interests first. When it comes to tariffs, it can be a tit-for-tat game, and investors will be worried about a potential reaction from the likes of China. The announcement of these tariffs is poorly timed, as the recovery in global stock markets was starting to show signs of slipping, and now dealers are dumping equities.
IMI had a solid set of results but profit-taking has set in, and the stock is in the red. Full-year revenue jumped by 6% and the total dividend was boosted by 1.8%. The company expects organic revenue for the first-half of this year to outstrip last year’s. The respectable numbers failed to impress investors and the stock fell to its lowest level for 13 months.
The US dollar is a little softer this morning as traders were prompted to take their profits when Mr Trump announced his plans to impose tariffs on steel and aluminium imports. The slight weakness in the greenback has helped EUR/USD. Germany and Italy released less than impressive economic indicators today, but the dip in the dollar took precedence. German retail sales grew by 2.3%, while economists were expecting 3.5%. The Italian economy grew by 1.6% in the fourth-quarter, down from 1.7% growth in the previous year.
At 3pm (UK time) the University of Michigan consumer sentiment report is released, and the consensus is for a reading of 99.5, down from 95.7 in the previous report.
We are expecting the Dow Jones to open down 108 points at 24,500 and we are calling the S&P 500 down 7 points at 2670.
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