Equities Slip As Trump Readies Beijing Response

Global equities mostly sank on Friday as US President Donald Trump readied a response to Beijing's controversial planned national security law for Hong Kong

London, (UrduPoint / Pakistan Point News - 29th May, 2020 ):Global equities mostly sank on Friday as US President Donald Trump readied a response to Beijing's controversial planned national security law for Hong Kong.

Trump has called a news conference later Friday, as heightened tensions between the two superpowers overshadowed optimism over signs that the global coronavirus crisis was easing.

"Markets are rightly worrying about escalating tensions between the US and China," said Holger Schmieding, an analyst with Berenberg.

Trump might announce targeted sanctions against Beijing, he said. "This dispute is serious," Schmieding added.

On Wall Street, the Dow Jones index was down around 140 points shortly after the opening bell, while European markets were also weaker.

"European markets are looking to end the week on a more pessimistic tone, with fears over the impending US reaction to Chinese actions in Hong Kong driving traders to bank their profits ahead of the weekend," noted IG analyst Joshua Mahony.

- Euro jumps - The European single currency briefly zoomed to a two-month peak as the dollar took a hit from souring China-US relations.

Trump told reporters at an Oval Office meeting that he was "not happy" with Beijing and the news conference would be about "what we're doing with respect to China", while giving no specifics.

The White House has already revoked the Hong Kong's special status, potentially opening the way for it to be stripped of key trading privileges such as lower tariffs than mainland China.

Relations between Washington and Beijing have deteriorated since the outbreak of the virus, which has killed more than 100,000 Americans, with Trump laying the blame at China's door.

The row has fanned fears of a renewal of their trade war, which hammered the world economy and sent markets tumbling last year.

Still, traders were drawing some support from parts of the world gradually returning to a semblance of normality as coronavirus death and infection rates eased.

- Renault hits skids - Renault was the biggest faller in Paris, with shares crashing by 7.6 percent after the company revealed a radical restructuring to save two billion euros ($2.2 billion) over three years.

The French carmaker plans to axe almost 15,000 jobs, including 4,600 at core operations in France as it seeks to steer out of a cash crunch exacerbated by the coronavirus crisis.

The group is switching focus to electric vehicles as it seeks to restore competitiveness in a market reeling from slumping sales, after the COVID-19 pandemic forced millions of people into home confinement.