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Trump’s China tweets cause global nose-dive

A surprise announcement by Donald Trump, on Twitter, that he will raise US import tariffs from 10 to 25 percent on $200 billion of Chinese goods, kicked 5.5 percent off Chinese stocks Monday.

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According to news site Marketwatch, Chinese stocks suffered their toughest one-session loss in more than two years on Monday, sending ripples across the world. Nordic stocks, as measured by the OMX Nordic 40 index, were down more than 2 percent by local lunch time Monday.

“This is scary. We have been taken by surprise by Donald Trump. Most have thought that the trade talks between the US and China have progressed well; these are the indications we have received. But this comes like lightning from a clear sky,” says Robert Bergqvist, chief economist with bank SEB, to Swedish business magazine Affärsvärlden.

He calls the message dangerous.

“A major part of the fantastic stock price increases this year have been the result of signals about the US–China trade talks going well,” says Robert Bergqvist.

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“For Europe it is a premonition of the car tariff negotiations to be initiated later. For those, Europe will be in focus.”

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