Investors worldwide await a set of measures to be announced later today by the US President Donald Trump against China about the Hong Kong crisis.
Trump’s Hong Kong Statement
Trump will make an announcement later in the day about the steps China is taking to further tighten its control of Hong Kong via a new national security law. Reports on the American media throughout the week suggested that the US would impose sanctions on some Chinese officials involved in the Chinese preparations of the law and remove some of the American economic privileges for Hong Kong.
US stock futures dropped early Friday, due to tensions between Washington and Beijing.
Stocks in Decline
Dow e-minis were down 91 points or 0.36%, S&P 500 e-minis fell by 8.25 points or 0.27%, as Nasdaq 100 e-minis lost 26.75 points or 0.28%.
EU foreign relations chief Josep Borrell said EU governments were concerned about China’s intervention in Hong Kong.
In Europe, the German Dax 30 index’s losses extended to 1.2% in the opening hours.
A spokesperson for British Prime Minister Boris Johnson called on China to reconsider the implementation of Hong Kong law, adding that the Brits hoped the Chinese would “listen carefully”. The depreciation of the British FTSE 100 continued to hover around 1% in London at noontime.
The US stock indices saw losses in the last session of Thursday, over worries that the world’s two largest economies are starting to clash again.
In Asia, MSCI’s largest Asia-Pacific index outside Japan fell by 0.2%. Japanese Nikkei retreated from the highest of the last three months. The Japanese rose to 107.70, the highest in the past two weeks against the new dollar. Bonds appreciated. Gold reached 1731.60, rising by 0.80%, benefiting from the tensions.
Powell Speech
Markets will be tuning in to a public webcast by the US Federal Reserve Chairman Jerome Powell during the day.
He is expected to detail the next phase of the Fed’s response to the coronavirus crisis.
EU-British Negotiations
Negotiations to regulate the post-Brexit trade relations between the UK and the European Union continue with no major development.
The EU resists in not stepping back on issues that hinder negotiations, especially fisheries. “All of the 27 EU member states fully support Barnier in the post-Brexit negotiations, and stand behind him,” an adviser to EU chief negotiator Michel Barnier said.
The euro continued to rise against the British pound and was at 0.9054 level.
