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The White House said that Donald Trump plans to strike imports for the United States with new definitions “immediately” on Wednesday, putting investors on the brink of the abyss and threatening to ignite a full global trade war.
Trump spent tense hours with his closest aides on Tuesday, on the eve of what he called “Tahrir Day”, when he announces his new “mutual treatment” for him Definitions In foreign countries at a ceremony in the White House park.
Traders have already prepared for repercussions and warn against making bold calls for what Trump will say, with Wall Street fluctuations measures that crawl in recent days.
“People who reduce risks and retract credit, retracting the dollar, retracting shares in recent weeks:” investor community is global anxiety, “said Robert Tib, head of global bonds at the director of assets.
After closed hours in discussions with the assistants on Tuesday, there was no minimal sign that Trump would back down from his plan to raise duties despite the warnings of influence on American economy.
White House journalist Caroline Levitte said on Tuesday that the definitions will be “immediately effective” and rejects concern in the markets that sparked a A sharp sale in the S&P 500 index In recent weeks.
Levitt said the American stock exchange was a “time shot”, echoing comments from Trump officials that the White House would look anti -market in the market.
“The president wants to make sure that the Americans are making well, especially the main street – this is the focus of these definitions. Wall Street will be fine.”
Trump’s tariff threats and subsequent turns of markets this year, pushing the US shares to decrease and pressure of bonds of companies with risk.
JPMorgan’s fixed income team sent a memorandum to customers on Tuesday afternoon with the title: “We don’t know what tomorrow will bring.” They pointed out that “the markets remained on the brink of the abyss” before the president’s ads.
While some investors are bonuses by riding volatility, many fund managers have moved away from making directional bets given the inability to predict the president.
“People do nothing strongly,” said Ed Al -Husseini, a great price analyst in Colombia Investment in Colombia for Investments.
Trump is expected to widely unveil the mutual definitions of trading partners in America, but investors are still not sure of their scope and size. Since the restoration of the office, it has already announced very slope definitions in Canada and Mexico before relieving plans.
To strike commercial partners with definitions immediately, Trump will need to resort to emergency economic measures in emergency situations. But whether it provides any allies relief is still unclear – as does the final purpose of the definitions.
While Trump Trade Secretary, Howard Lootnick, pressed foreign officials for “deals” in meetings held in recent weeks, Trump’s other assistants believe that customs tariffs are a way to increase the planned tax discounts planned.
“April 2 feels” a clearing event “in one way or another.” “You must answer the biggest question from the market, which is if the definitions are a way to achieve an end or the end.”
Market fluctuations expected in recent days increased, as the VIX Index for Disorders increased in the expected stock market 4.6 points during the past week to 22, higher than a long -term medium of 20.
The CME index of turmoil in the five most traded currencies in the world, and the monitoring bank of Bank of America closely from the implicit fluctuations in the US Treasury Market both are at the highest levels since mid -March.
But these measures are still much lower than the summits that have been touched this year. Mandy Show, head of the Mashqat Market Intelligence in the CBOE Global Markets Markets, said that there is a minimal sign of the “Liberation Day allowance” in the prices of stock market fluctuations. She added that investors expect the S&P 500 to circulate within the 1.6 percent range on Wednesday.
Rocky Fishman, derivative analyst in the ASYM 500 research group, said at the same time, the derivative market, where futures and options are traded, showing “little additional risks” on April 2.
“Most investors realize, whatever thinking, (Trump’s ads on Wednesday) can leave them with eggs on their faces.”
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