In the last two days Trump criticized the Federal Reserve for raising interest rates and said China, said he's willing to put tariffs on all USA imports from China, and said China, the European Union and others are harming the U.S.by weakening their currencies and reducing interest rates. Bond yields are rising and the dollar is falling.
The broad-based S&P 500 dropped 0.1 percent to close the week at 2,801.83, while the tech-rich Nasdaq Composite Index also fell 0.1 percent to 7,820.20. Eastern time. The Dow Jones Industrial Average lost 3 points to 25,061. London closed less than a tenth of a percentage point lower while Frankfurt ended the day down almost 1.0 percent. The MSCI Emerging Market Index gained 1.1 percent.
Microsoft continued to set records after its fiscal fourth-quarter results topped Wall Street forecasts and its cloud computing division continued to grow.
"The reports out of Italy today are a reminder of just how dysfunctional the Italian government is", said Chris Scicluna, head of economic research at Daiwa Capital Markets in London.
US stocks inched lower Friday as bond yields jumped, a shift that helped banks but hurt companies that pay big dividends. The stock sank 21 percent to $26.29.
BONDS: Bond prices dipped.
Benchmark 10-year USA notes last fell 13/32 in price to yield 2.895 percent, from 2.847 percent late on Thursday. Instead, China's central bank helps guide the currency by setting a daily trading range. South Africa's rand gained 1 percent to 13.41 per dollar. It is supposed to encourage investors to buy U.S. debt in the knowledge that the United States administration won't deliberately weaponise the greenback and debase its currency. The euro rose for a second day, gaining to $1.1655 from $1.644.
President Trump said "I'm willing to go to 500", referring roughly to the $505.5-B in goods imported previous year from China. Trump's comments point to a willingness to push the envelope as far as the USA needs to get Chinese tariff concessions, along with a pledge to stop allegedly stealing American technology. The Trump Administration announced a 2nd possible round targeting $200-B worth of goods on 10 July.
However, China's yuan largely continued its steady decline against the U.S. dollar, providing Beijing with a buffer against the punitive tariffs as the Shanghai Composite on Friday rose 56.73 points, or 2 percent, to 2,829.27, but shed 0.1 percent from a close of 2,831.18 a week earlier.
As the trade war escalates, so have analysts' estimates of potential economic consequences.
In addition, President Trump has told the Commerce Department to investigate whether imported autos and auto parts threaten America's national security - the same justification the president invoked to impose tariffs on steel and aluminum. Representatives of the auto industry asked Congress to oppose that move on Thursday.
Instead, by sticking to proposed mandates - whatever they may uniquely be - central bankers and other boffins can target other failing metrics (inflation, most pertinently, but many others too) to adjust policy settings, with the knock-on being a weaker currency. If the yuan continues to depreciate, goods exported to China will become more expensive to consumers there and Chinese exports would also be relatively cheaper. In return, China levied taxes on the same value of US products.
In late NY trading, the euro was up to $1.1725 from $1.1644 in the previous session, and the British pound increased to $1.3135 from $1.3015 in the previous session.
2-year yield: USA 2.59% Australia 2.07%. Heating oil edged up 0.7 percent to $2.10 a gallon. Copper jumped 2.2 percent to $2.76 a pound. Britain's FTSE 100 gave up 0.1 percent. Hong Kong's Hang Seng gained 0.7 per cent to 28,212.37.
Japan's Nikkei 225 bucked the regional trend, losing 0.3 per cent to 22,697.88.