President Trump Talks About New Tariffs on China
President Trump has threatened new tariffs on China over coronavirus crisis and this has led to decline in the US stock markets. Market analysts feel that this could be President Trump’s attempt to divert attention from the many failures of his administration to deal with coronavirus pandemic. Trump has earlier also blamed China for spread of the virus and many other leaders across the world have questioned Chinese efforts to muzzle news reporting about the virus during its early days.
Medical experts feel that if China had warned the world about the risk of coronavirus on time, we could have escaped pandemic. However, there are different views on the issue. Chinese government managed to contain the virus with lockdowns while United States delayed action on spread of COVID-19.
Dow Jones Industrial Average was down by nearly one percent to 24,110. In the recent days, markets have gained some ground as the risk of coronavirus in Western Europe has reduced. Many regions in Western Europe have opened up small businesses in the recent days. With economic activity picking up, crude oil prices jumped this week. The situation might return to normal in few months but the actual impact of coronavirus on earnings of companies will be seen in quarterly results to be reported in July – August 2020.
Apple and Amazon have issued warnings about impact of coronavirus on their earnings. Many companies are facing tough times and Apple might see lower sales as people would defer buying smartphones if they have lower purchasing power. Recent reports from US suggest that consumer confidence has dipped and retail sales for many products except for groceries have suffered.