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Tuesday, 03 December 2019 06:58

European shares whacked lower as Trump says China trade deal may come only after Nov 2020 election

Written by Reuters
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LONDON (Reuters) - European shares fell back into the red on Tuesday, abandoning earlier efforts to claw their way back from three days of falls, as U.S. President Donald Trump said a trade deal with China might be delayed until after November 2020 elections.

Those comments, made as Trump landed in Britain for a NATO summit, also sent the offshore-traded Chinese yuan to near five-week lows. France, the latest U.S. trade war target, saw shares tumble more than 0.6% to a one-month low.

A pan-European equity index, fell 0.2%, giving up earlier modest gains and extending Monday’s 1.6% tumble which was its biggest one-day loss in two months. U.S. stock futures also turned negative, with S&P 500 futures down 0.4%.

Trump’s willingness to open new fronts in the trade war despite signs of economic damage has unnerved markets.

His latest comments appear to dash hopes that an agreement with China could be reached before another round of tariff hikes kicks in on Dec. 15, and suggests talks could in fact could drag on for another year.

Markets had fallen sharply on Monday after Trump tweeted he would slap tariffs on Brazil and Argentina for what he saw as both countries’ “massive devaluation of their currencies.

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