Asian markets tumble as China-US trade tensions rise

Trade worries extend equities' slide into new quarter

Asian markets tumble as China-US trade tensions rise

Amid escalating transatlantic trade tensions, the European Union has sent a strong warning to US President Donald Trump about the real costs of putting tariffs on cars.

About $2.3 billion of MI exports could be subject to retaliatory tariffs by China, Mexico, Canada and the European Union, according to a new analysis conducted by the United States Chamber of Commerce. Using a state-by-state analysis, it argues Trump is risking a global trade war that will hit the wallets of US consumers.

"The European Union is possibly as bad as China, just smaller", President Trump replied to Bartiromo. "So he holds a press conference - the president is barely out of there on the plane to North Korea, and he starts insulting us, he starts talking about the U.S.is insulting Canada", Kudlow said on CBS' "Face the Nation" in June.

Pushing back against Mr Trump, the chamber based a state-by-state analysis on data from the US Department of Commerce and government agencies in China, the EU, Mexico, and Canada.

"No, no, no, no", he said, noting that more tariffs could be imposed if there is no deal with China.

At Trump's insistence, Canada, Mexico and the US are renegotiating the North American Free Trade Agreement (NAFTA). Trump says the WTO has allowed the United States to be taken advantage of in global trade.

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Last Friday, the European Union said that tariffs on cars and vehicle parts were unjustifiable and did not make economic sense, according to a 10-page report sent to the United States Commerce Department. But Italy blocked their formal adoption until the migration issue was fully addressed. The EU had calculated that a 25% tariff would have an initial US$13-14 billion negative impact on United States gross domestic product with no improvement to its current account balance.

Owing in part to President Donald Trump's tax reform, which cut the corporate tax rate to 21% from 35%, companies listed in the S&P 500 Index boosted stock buybacks, setting a new record for the group during the first quarter.

The Chamber of Commerce is focusing their efforts at the state level.

"We ask that you will support us by imploring our elected officials to recognize that these tariffs are seriously harmful to American businesses like Moog", the company says.

Moog isn't the only U.S. business facing problems because of Trump's trade tariffs. Trump previously announced a 25% tariff of up to $50 billion of Chinese products starting on July 6, while China in response will place tariffs on $34 billion of American goods coming into the country.

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