Trade War Escalation Fears Drive FTSE Down to a Six-Month Low - Forex News by FX Leaders

Trade War Escalation Fears Drive FTSE Down to a Six-Month Low

Posted Friday, August 16, 2019 by
Arslan Butt • 1 min read

The intensifying trade war between US and China has hit global stock markets quite hard with the FTSE falling to a six-month low on Thursday as China hit back at the US for its latest tariff announcement. At the time of writing, FTSE is trading at a little over 7092, having recovered a little bit after closing 1.13% lower at the end of yesterday’s trading session.

Even though Trump announced a delay on some tariffs from September to December, China has alleged that these tariffs violate the truce both Trump and Xi had called for during the G20 summit when trade negotiations resumed again. Global stock markets worry that a prolonged trade war can push world economy into recession.

In addition, the recent yield curve inversion in UK and US also point to increasing signs of a recession. The last time this happened was in 2007, just before the financial crisis took down markets all around the world.

FTSE was also weighed down by a sudden strengthening in the Pound following a better than expected retail sales report.

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About the author

Arslan Butt // Index & Commodity Analyst
Arslan Butt is our Lead Commodities and Indices Analyst. Arslan is a professional market analyst and day trader. He holds an MBA in Behavioral Finance and is working towards his Ph.D. Before joining FX Leaders Arslan served as a senior analyst in a major brokerage firm. Arslan is also an experienced instructor and public speaker.
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