Trade tensions between China and the United States, materialized by the surprise arrest of a Huawei executive, crystallize concerns.
New difficult day in the Asian markets. Thursday, at the close, the Japanese Nikkei sold 1.91%, leaded by Softbank in particular, down 5%. Shortly before the Chinese markets closed, the Shanghai Composite dropped 1.47%. The Hang Seng, the stock index of the Hong Kong Stock Exchange, lost 2.6%.
Asian stock markets are still worried about the risk of global recession. If Wall Street was closed yesterday because of national mourning, the US index plunged 3% Tuesday, bringing in its wake the European and Asian markets Wednesday.
The spread between US 2-year and 10-year bond yields has never been so low since 2007, the year of the financial crisis. A reversal of both curves has always been followed by a recession in the United States, which explains stock market concerns.
Fragile commercial truce
The global trade climate is still weighing on the Asian markets. If Beijing and Washington have signed a truce, it remains fragile. On Twitter on Wednesday, Donald Trump did not fail to recall that in the absence of an agreement with China, he would raise without hesitation customs duties on new Chinese products imported to the United States.
Tensions between the two countries persist, like the shock arrest of the financial director of Chinese telecom giant Huawei. Wanzhou Meng, also vice president and daughter of the firm's founder, was arrested Wednesday in Canada on grounds of potential violations by Huawei of US sanctions against Iran.
She risks extradition to the United States, according to the Canadian Minister of Justice. China, which protested forcefully against the arrest, is demanding the immediate release of Wanzhou Meng. Fearing a new escalation of the trade war with the United States.