Trump tweets bring oil, equities lower

August 1, 2019
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At around 12:30 Central today, US President Donald Trump announced via Twitter that the US will increase tariffs against Chinese trade.

Both oil and equities fell quickly as the news broke. WTI dropped to under $54 in the next hour.

The charts included to the left show the implied trade frictions from additional tariffs took their toll quickly and across asset classes. These charts stop at 1:00 PM Central time, but the two prices headed lower after that.

Trump’s several Tweets read as follows:

“Our representatives have just returned from China where they had constructive talks having to do with a future Trade Deal. We thought we had a deal with China three months ago, but sadly, China decided to re-negotiate the deal prior to signing. More recently, China agreed to….buy agricultural product from the U.S. in large quantities, but did not do so. Additionally, my friend President Xi said that he would stop the sale of Fentanyl to the United States – this never happened, and many Americans continue to die! Trade talks are continuing, and…..during the talks the U.S. will start, on September 1st, putting a small additional Tariff of 10% on the remaining 300 Billion Dollars of goods and products coming from China into our Country. This does not include the 250 Billion Dollars already Tariffed at 25%……We look forward to continuing our positive dialogue with China on a comprehensive Trade Deal, and feel that the future between our two countries will be a very bright one!”

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