Singapore market trends Tuesday: US trade war fears rekindle amid report more tariffs on China are planned

Singapore shares face a tough Tuesday, with negative leads from Wall Street and early Asian trading amid reports that the U.S. is planning to up the ante in its trade war with China.

Trade war fears re-emerged in the U.S. session after a Bloomberg report, citing unnamed sources, that the U.S. would announce tariffs on all remaining Chinese imports that don’t already have tariffs by early December if November talks between U.S. President Trump and Chinese President Xi Jinping failed to reach an agreement.

Scotiabank also pointed to concerns over the U.S. economic outlook after the tax cut package.

“The overall message is that the stimulus boost to income transfers earlier this year continues to be spent and unwound as a transitory effect with little inflationary pressure. All of this is classic pre-midterm pump priming that immediately put cash into the hands of consumers and made more bullets through a jump in defense spending to get stimulus out as fast as possible and create the illusion of strong growth just in time for the November election before the effects then wear off,” Scotiabank said in a note early Monday, U.S. time.

“It’s a classic case of fool-me-once and shame on you, fool me twice and shame on markets and voters,” it added.

Indexes

Japan’s Nikkei 225 index was down 0.31 percent at 8:09 A.M. SGT, while South Korea’s Kospi was off 0.24 percent at 8:14 A.M. SGT.

Singapore’s Straits Times Index ended Monday up 0.32 percent at 2981.54; October futures for the index were at 2979 on Monday, while November and December futures were at 2980 and 2978 respectively.

Hong Kong’s Hang Seng Index ended Monday up 0.38 percent at 24,812.039, while China’s CSI 300 fell 3.05 percent to 3076.889.

Malaysia’s KLCI edged up 0.04 percent to 1683.73, while Indonesia’s IDX Composite fell 0.52 percent to 5754.61 on Monday.

The Dow Jones Industrial Average shed 0.99 percent to 24,442.92 on Monday, the Nasdaq Composite was down 1.63 percent at 7050.292 and the S&P 500 lost 0.66 percent to 2641.25. Futures for the three indexes were in the red in early trade.

Currencies

The U.S. dollar index was at 96.66 at 7:59 A.M. SGT, rising from as low as 96.38 earlier in Monday’s session, according to ICE futures data.

The 10-year U.S. Treasury note yield was at 3.085 percent at 8:06 A.M. SGT after rising as high as 3.111 percent from as low as 3.063 percent in Monday’s session, according to Tullett Prebon data.

The euro/dollar was at 1.1377 at 8:12 A.M. SGT after trading in a 1.1359 to 1.1416 range on Monday, according to DZHI data.

The dollar/yen was at 112.349 at 8:12 A.M. SGT after trading in a 112.75 to 112.565 range on Monday, according to DZHI data.

The dollar/yuan ended Monday at 6.9604 after trading in a 6.9386 to 6.9615 range on Monday, according to DZHI data.

The dollar/Singapore dollar was at 1.3833 at 8:13 A.M. after trading in a 1.3792 to 1.3837 range on Monday, according to DZHI data.

The dollar/Malaysian ringgit ended at 4.1780 Monday after trading in a 4.1700 to 4.1795 range on Monday, according to DZHI data.

The dollar/Indonesian rupiah ended Monday at 15,215 after trading in a 15,200 to 15,227 range on Monday, according to DZHI data.

Oil

Nymex WTI crude oil futures for December were down 0.54 percent at US$66.68 a barrel at 7:49 A.M. SGT, while ICE Brent crude futures for December were off 0.36 percent at US$77.34 a barrel at 5:38 A.M. SGT, according to Bloomberg data.

Read more: Crude oil heads weaker in Asia ahead of Tuesday‘s API estimates

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