Business leaders at a trade event in Denver on Tuesday said the Trump Administration’s proposed 25% tariffs on a wide range of Chinese goods will mean higher costs that will have to be passed on to consumers if the tariffs take effect. (May 14) AP, AP
The stock market has endured a bumpy two weeks since President Trump said he would raise tariffs on $200 billion in Chinese imports from 10% to 25%, producing some winners and losers.
The damage spread this week after China said it would hike retaliatory tariffs on U.S. exports to that country to as much as 25%.
While the Dow Jones industrial average has pared severe losses several times over the period as hopes for a settlement wax and wane with each Trump tweet or White House update, the Dow is down 178 points, or 0.7%, this week after recovering much of the losses suffered Monday and Tuesday. It has also fallen 741 points, or 2.8%, during the past two weeks.
The Dow closed down 99 points Friday at 25,764 Friday, though investors remain encouraged by signals that Washington and Beijing still plan to continue negotiations.
Salmonella alert: Backyard chickens have caused 21-state outbreak, CDC says
Here are the companies with the steepest percentage declines:
Intel is the biggest Dow loser, dropping 10.71% since the president first tweeted about the higher tariffs May 5. Nearly 27% of its revenue came from China in 2018, according to Statista.
Another poor performer is Apple, which has fallen 9.46%. The company both assembles and sells products in China, making it sensitive to price increases that dampen Chinese consumers’ confidence
Although the tariffs haven’t yet affected Apple’s products, the company would be hammered if the trade war escalates further to include all Chinese imports to the U.S. The technology company has more Chinese suppliers than ever, according to its supplier list. China, including Hong Kong and Taiwan, represented 19.2% of Apple revenuen) in 2018.
Caterpillar, Boeing and 3M have been slammed on trade war fears as well.
Caterpillar shares have tumbled about 9%. China sales make up 5% to 10% of Caterpillar’s total revenue, the company says. The construction and mining equipment giant’s sales in the Asia-Pacific region climbed in 2018 because of the rising demand in China.
3M stock slid 8.5% as the conglomerate cut its 2019 profit outlook because of weak demand in China earlier this year and it said it would lay off 2,000 workers. Asia-Pacific is 3M’s biggest market outside the U.S.
Boeing is down more than 5%.. More than half of all commercial jetliners flying in China are made by Boeing. Boeing generates more than $1 billion in economy activity in the country, according to the company.
Small business impact: Tariffs from US-China trade war force small businesses to strategize to preserve profits
Meanwhile, some companies aren’t showing any scars from trade war. The top five Dow winners include Chevron, United Health Group, Travelers Cos, Cisco Systems and McDonald’s.
President Donald Trump is a self-described “Tariff Man” whose hawkish views on trade represent a rare constant in his flexible ideology. But his assertions about trade policy suggest he either can’t, or won’t, grasp the fundamentals of the issue. (May 14) AP, AP
Read or Share this story: https://www.usatoday.com/story/money/2019/05/17/dow-stocks-hurt-most-trade-war-escalates-between-us-and-china/3685241002/
Powered by WPeMatico