— This is the script of CNBC's news report for China's CCTV on December 4, 2019, Wednesday.
Trump threatened to impose new round of tariffs, the main reason for that is the digital tax, we know that France has passed related bills to impose a 3% digital tax on teach giants, so American tech companies bear the brunt, and Trump doesn't think their ally should do that.
Donald Trump, US President
The tech companies you're talking about are not my favorite people because they aren't exactly for me, but that's O.K, i dont care, They're American companies. We want to tax American companies. That's important. We want to tax them, not somebody else to tax."
Almost none of French Luxury companies is immune from the decline in stock trading on Tuesday, local time, after Trump delivered his attitude on imposing tariffs, with Hermes lost 2.53%, LV's parent company LVMH dropped 1.48%, Dior down 1.5%, Kering SA, which is the parent company of Gucci, YSL, Balenciaga etc., declined 1.78%. Champagne related stock prices also got affected.
Verallia, the major glass container producer in France, eased 2% Wednesday.
This France-targeted tariff plan is expected to take effect in January, once it comes into force, then it will be the 2nd time that U.S. imposes tariffs on France imported products in recent several months.
U.S. has announced to slap tariffs on $2.5M Europe imported products as its unsatisfied with WTO's verdict result on aircraft subsidy issue. France is one of the major countries being impacted.
Tuesday, local time, on backdrop of the tense trading situation, CAC40 was off 1%, U.S. stock market also dropped for 3 straight trading days with DJIA lost more than 280 points. Recently, the news that the United States plans to impose tariffs has become more frequent reported, this week, the U.S. announced to resume tariffs on steels and aluminum imports from Brazil and Argentina.
U.S. is going to brace its election year, Trump has to show his achievements to voters, now there is one more object in the trade war. December 15th is a significant date as U.S. will impose 15% tariffs on China imported products on this day.
Markets worry that if international trade relationship gets worse at some time, then anther round of bear sells, like the one happened in Dec last year, would come again at the Wall Street. We will keep an eye on this issue.