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Before the bell: China-U.S. trade spat causes jitters on the Street

Posted Sep 14th 2009 7:33AM by Melly AlazrakiMelly Alazraki RSS Feed
Filed under: Before the bell, International markets, China, Market matters, Economic data, Financial Crisis

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U.S. stock futures declined Monday morning as concerns mounted over China-U.S. trade spat just as the world economy is said to begin emerging from the recession. Investors also await a speech by President Obama about financial services reform.

A U.S. decision to impose special duties on Chinese tires, which could be the first shot of many trade complaints against Chinese products, started a trade spat between China and other Western economies. In return, China said it may complain to the World Trade Organization and announced its own anti-dumping investigations of motor vehicles and chicken products from the U.S. While causing jitters in financial markets, it's unlikely the sparring could cause an all out trade-war as there is too much at stake.

Meanwhile, Obama will try on Monday to reinvigorate Wall Street reforms, using the anniversary of Lehman Brothers' collapse to argue for sweeping regulatory changes. At 12:10 p.m. Eastern Obama will give a wide-ranging economic address in New York that will also discuss plans to unwind the government's involvement in the financial sector.

Despite the administration's efforts, according to an AP poll, one year after Wall Street teetered on the brink of collapse, seven out of 10 Americans lack confidence the federal government has taken safeguards to prevent another financial industry meltdown.

Overseas, European and Asian markets fell Monday, shaken by the U.S.-China trade dispute news even as the European Union said the recession in the euro-zone and EU will likely have ended in the third quarter with the resumption of modest economic growth.

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Last updated: November 23, 2009: 09:10 AM

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