Trump trade war: U.S. stock market is faring better than China's since dispute began

collected by :Molly Tony

Trump trade war: U.S. stock market is faring better than China's since dispute beganAdam Shell | USA TODAYAPEconomists say there are no winners in a trade war, and American farmers, appliance companies and automakers are proof that tariffs can inflict financial harm. But if you're using the stock market as a measure of who's winning the trade dispute, the U.S. has a clear lead over China and its other trading partners. The Standard & Poor's 500, a stock index filled with America's biggest companies that get more than 43 percent of their revenues from overseas sales, is up 6.1 percent this year. The major stock index in Japan is down a little less than 1 percent and European shares are up just 0.3 percent. If Trump wins concessions from China or the European Union, it could prove bullish for stocks as trade terms improve for U.S. companies.

The stock market keeps shrugging off trade war

Large-cap stocks, as represented by the S&P 500, are closing back in on their January high. as he prepares another round on $100 billion in Chinese imports (adding to the higher tariffs on $50 billion in imports already on the way). A protracted trade war that results in higher labor and material costs threatens all of this. Focusing just on tariffs, Goldman estimates that a 10 percent across-the-board tax on all imports would cut S&P 500 profits by 15 percent. Goldman has already noted that the current spat has deepened from a trade war to a currency war amid dramatic weakness in the Chinese yuan (and President Trump's apparent efforts to weaken the U.S. dollar).

Traders debate how a trade war will affect the stock market

referring to It's that "to date" part that has gotten a large part of the investor base considerably more nervous. This is a major issue that the market, up until today, has been completely neglecting."The commodity markets aren't neglecting the threat. Copper is down dramatically in the past month on concerns over a slowdown in China and an increase in trade tensions. The Fed said this a month ago (June 12 to 13) — a time when tariffs looked like only a remote possibility. What side of this debate do you think they will be on now that tariffs have become very real?