Sensex, Nifty Look Set To Extend Losses

(RTTNews) - Indian shares look set to extend losses on Tuesday amid an escalation in U.S.-China trade tensions after China said it would raise tariffs on some U.S. goods beginning June 1, with the tariffs ranging from 5 percent to 25 percent.

On Twitter, U.S. President Donald Trump told China the deal will become far worse for them if it has to be negotiated in his second term.

"I say openly to President Xi & all of my many friends in China that China will be hurt very badly if you don't make a deal because companies will be forced to leave China for other countries. Too expensive to buy in China," Trump tweeted. "You had a great deal, almost completed, & you backed out!"

Trump has previously threatened to raise tariffs on essentially all remaining imports from China, which are valued at approximately $300 billion. Despite the rhetoric, both countries have indicated more talks are likely.

Benchmark indexes Sensex and the Nifty fell around 1 percent on Monday to extend losses for the ninth straight session while the rupee tumbled 59 paise to close at nearly two-and-a-half-month-low of 70.51 against the dollar.

Asian stocks tumbled and the dollar index was slightly lower while oil prices inched higher in cautious trade.

U.S. stocks fell sharply overnight after China announced plans to raise tariffs on $60 billion worth of U.S. goods in retaliation for Trump's recent decision to raise tariffs on approximately $200 billion worth of Chinese goods.

The Dow plunged 2.4 percent to a three-month closing low, while the tech-heavy Nasdaq Composite plummeted 3.4 percent and the S&P 500 tumbled 2.4 percent to their lowest closing levels in over a month.

European markets also moved to the downside on Monday amid worries about Brexit and trade war worries.

The pan European Stoxx 600 shed 1.2 percent. The German DAX lost 1.5 percent, France's CAC 40 index dropped 1.2 percent and the U.K. FTSE 100 declined 0.6 percent.
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