European Markets Plunge, VIX +46%, Yuan 3-Year Low as US-China Trade Tension Escalates!
European markets opened lower as Trump threatened to hike tariffs on Chinese goods while yuan fell to a 3-year low.
Following the tweet from the U.S. President Donald Trump yesterday that threatened to hike tariffs on $200 billion worth of Chinese goods by this Friday after a report of China’s government was considering canceling this week’s talks, global market all sank to negative territory.
European markets opened lower as expected. DAX was downed 1.96% at the opening bell, CAC 40 slipped 1.76%, STOXX 50 fell 1.91% while FTSE closed for the Early May Bank Holiday. Meanwhile, CBOE Volatility Index (VIX) rose as much as 45.9%, showed how concern investors were.
As for Asia markets which were now closed. SSEC closed in a horribly way with a loss of 5.58%, HSI slipped 2.90%, ASX 200 dipped 0.82%, KOSPI lost 0.74% while NIKKEI and SET was closed during the coronation ceremony.
Currencies
The dollar eased to 110.53 yen, having earlier touched a five-week trough at 110.335 on Reuters dealing. It had ended Friday around 111.12.
The euro hit its lowest since January around 123.33 yen and was last at 123.56.
The dollar climbed 1% on the Chinese yuan to 6.8007, while Shanghai blue chips lost 4%.
The Australian dollar took a spill given the country’s exposure to Chinese trade and lost around 0.6% at one stage to $0.6960. It was last down at $0.6982.