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Markets wobble ahead of G7 as Trump attacks allies on Twitter

by | 8 Jun, 2018

The Donald is not in Mexico or the EU’s good books right now

Ahead of today’s G7 meeting in Quebec (or the ‘G6 + 1’ as some are calling it), President Trump took to Twitter to take a pop at allies including Canada and France for their hypocrisy on trade. 

As tensions rise, risk aversion has returned to the markets, with equities across the globe sinking overnight ahead of the contentious meeting. All of Asia and Europe’s key indices are trading in negative territory at the time of writing, while US stock futures for the NASDAQ and S&P500 also fell today. Investors are worried that bad-blood between the leaders at the summit could lead to an escalation of a trade conflict, bringing with it negative consequences for the world economy and thus more volatile stock markets and lower shareholder returns. 

Fortunately, there may be a brief boost to global indices once again, if Trump’s meeting with North Korea’s Kim Jong-un proves to be fruitful when they meet in Singapore on June 12th. Given the back and forth rhetoric over the last year which included the President saying the DPRK would be met with “fire and fury” if it instigated any military confrontation with the US, it still seems surreal that a positive outcome can be gained, but given the unpredictability of the Trump administration and the North’s willingness to release American hostages and blow up a key nuclear test site, hopes are high.

In non-market related news, there was a morsel of positivity for the Trump team today, as the NATO Secretary General Jens Stoltenberg confirmed that allies in NATO had raised their defence spending by 3.82% over the past year, with more putting forward plans to reach the required 2% of GDP they are each supposed to give by 2024. This wouldn’t have been possible without Trump’s urging. 

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ALL RIGHTS RESERVED © INVSTR LTD. 2018

Risk Disclosure:
Invstr is a technology platform, not a registered broker-dealer or investment adviser. Invstr does not offer its own recommendations of any security or provide its own research to any user regarding any security transaction or order.
Please note, investing involves risk and investments may lose value. Past performance does not guarantee future results.
Brokerage services are provided by the following:
US-traded securities, including fractional trading, are provided to Invstr users by DriveWealth LLC, a regulated member of FINRA/SIPC. DriveWealth may not establish investment accounts to residents of certain jurisdictions. For more information, including disclaimers, risk and transaction fees click here.
India account traded securities are provided by SIC Stocks & Services PVT Ltd. SIC does not make any personal recommendations to buy, sell or otherwise deal in investments. Investors make their own investment decisions. The services and securities provided by SIC may not be suitable for all customers and, if you have any doubts, you should seek advice from an independent financial adviser. For more information and disclaimers, click here.

 

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