General Motors Co urged the US and China to engage in constructive dialogue over trade.Rival Ford Motor Co too encouraged both governments to work together to resolve issue. The stock of automobile firms have suffered before retracing losses.
BOEING & INDUSTRIALS
Aircraft maker Boeing Co closed down 1 per cent, weighing the most on the Dow Jones Industrial Average as documents from China’s Ministry of Commerce and the US manufacturer showed the move would affect some older Boeing narrowbody models. Boeing said it was assessing the situation while analysts from JP Morgan said the proposals from China looked to have been calibrated carefully to avoid a major impact on the planemaker.
Farming equipment maker Deere lost nearly $10 per share at its lowest. The company urged the two countries to work toward a resolution to “limit uncertainty for farmers.”
The S&P 500 technology sector, which has the biggest revenue exposure to China among the benchmark’s 11 major sectors, dipped 0.5 per cent before rebounding to end 1.3 per cent higher.
Chip stocks were among the worst-hit in the sector with Intel Corp and Nvidia Corp both falling before retracing losses to end narrowly higher. China’s position as an assembly hub for electronic devices makes it the biggest consumer of semiconductors. Cisco Systems Inc said it was “analysing the impact of these tariffs on Cisco and reviewing plans to minimise the impact on our business, our customers and partners.”
Brown-Forman Corp, the maker of Jack Daniel’s whisky, slipped after whiskey was singled out as the only spirit on which China planned to impose more tariffs. The Distilled Spirits Council, a US industry group, asked the US and China to reach a resolution without subjecting American whisky to more tariffs, which it said would harm Chinese consumers, its hospitality sector and US whiskey exporters. The Councisaid US whiskey accounted for nearly 70 per cent of the total US spirits exported to China, by value, in 2017.
COMMODITIES & CHEMICALS
DowDuPont Inc said its agriculture unit could be affected by the escalating conflict, warning of price declines for soybeans, and a negative impact on US farmers. The American Chemistry Council (ACC) - which counts Exxon, Chevron, Monsanto and others as its members - urged the United States and China to come to an understanding. “Engaging in a trade war with one of our country’s most significant trading partners is not the answer,” said ACC Chief Executive Officer Cal Dooley.
US meat processor Tyson Foods Inc and meat exporter Hormel Foods Corp rose on the prospect of a drop in prices of soybean — a key feedstock — following higher Chinese tariffs on US exports.