Northern hemisphere countries are starting to re-open their economies with the onset of summer and a reduction in the pace of the pandemic thanks to the drastic measures taken.
Sino-US Agricultural Trade
But the fact that the US states and European countries started to open their economies gradually has not been a satisfactory development for the markets.
According to reports from international news agencies Monday, the Communist Beijing government told state-owned companies to stop purchasing soybeans and pork from the United States. China’s purchase of the American agricultural products was one of the most important parts of Phase-1 trade deal and Trump’s biggest promise to the US farmers. China’s halt of purchases comes after Trump promised to sanction the Chinese authorities in response to Beijing’s attempts to further take control of the autonomous city of Hong Kong.
Speaking to Reuters, a Chinese source said that purchases of large volumes of American corn and cotton were also suspended. The source said that if Washington takes more action over Hong Kong and other geopolitical issues, the purchase of more US agricultural products could be stopped.
“Now we will watch and see what the US will do next,” the Chinese official said speaking on the condition of anonymity.
Markets in a Cautious Mood
The bad news coming from China, which is likely to attract Trump’s reaction, and the killing of a black man in the US during police arrest, put the indices in flat trading.
US National Guard troops were deployed in 15 states and Washington DC Sunday to intervene at the request of the governors, with peaceful protests turning violent.
Target and Walmart closed some of their stores amid looting as their shares dropped by 2% and 0.9%, respectively before trading hours. Amazon has significantly reduced its shipments in many cities.
Dow e-minis rose 21 points or 0.08%. S&P 500 e-minis lost 0.75 points or 0.02%. Nasdaq 100 e-minis fell by 24.75 points or 0.26%.
The European Union is beginning to believe that Britain wants post-Brexit negotiations to fail. The allegation comes from EU diplomats who spoke to the American Business Insider news websites.
Speaking to BI, EU officials said that the widespread view in Brussels is that the British Prime Minister Boris Johnson’s government was deliberately obstructing the negotiations regarding the post-Brexit trade.
A spokesman for Johnson said in a statement today, that the Brits were hoping the talks that restarting on Tuesday will be constructive.