Monday, 23 May, 2022
HomeGlobal PulseUS markets react sharply to escalating trade war with China

US markets react sharply to escalating trade war with China

China announced to increase tariffs on $60 billion worth American imports and WhatsApp voice calls used to inject Israeli spyware on phones.

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China announces retaliatory tariff hikes

On Monday, China announced its decision to retaliate to American tariff hikes. The Chinese government is set to raise tariffs on $60 billion worth of American imports.

After the development, the US S&P 500 Index fell by 2.4 per cent. In comparison, the Asian stocks experienced only moderate decline in the early hours of trading.

Companies, which have a lot of exposure to China, were greatly affected by the implementation of tariffs. Apple and Caterpillar that have a large chunk of their production in China slid by 5.8 and 4.6 per cent, respectively.

Meanwhile, according to a report in the Financial Times, if this develops into an all-out trade war between the US and China, it might lead to grave economic ramifications.

The report quotes Bo Zhuang, chief China economist at TS Lombard, whose estimates suggest that if the latest round of American tariffs were implemented, China’s exports to the US would fall by $75 billion. Zhuang’s estimates also note if America implements tariffs on all Chinese goods, then the Chinese exports could fall by $170 billion.

The Chinese government has been putting up a strong front and has argued that it could withstand the American trade aggression. But, data suggests that both the US and China have seen their exports decline over the past year, owing to the trade war.

WhatsApp urges users to update app to fix bug

WhatsApp has confirmed that hackers were able to use voice calls to inject a spyware on phones, leading to a massive vulnerability in the world’s largest virtual messaging service.

The spyware was injected even when the users did not receive calls. In several cases, it eventually disappeared from the call logs.

An Israeli company NSO Group developed the spyware that made its way into WhatsApp. NSO said in a statement, “NSO’s technology is licensed to authorised government agencies for the sole purpose of fighting crime and terror. The company does not operate the system, and after a rigorous licensing and vetting process, intelligence and law enforcement determine how to use the technology to support their public safety missions.”

WhatsApp said it has fixed the loophole, which caused this cyber-attack. It has urged all its users to update the application, which fixes the existing bug.

In other news:

China exporters react to Donald Trump’s new trade war tariff plan: ‘This will kill my US market’, South China Morning Post

Trump praises Hungary’s Orban in White House visit, Financial Times

Philippine Vote Positions Duterte’s Daughter as Likely Successor, Bloomberg

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