European Uncertainty and Trade Tensions With China Weigh on Markets
*By Alisha Haridasani*
Political uncertainty in Europe and a White House decision to proceed with tariffs against China dragged major U.S. indices down on Tuesday.
“It’s kind of been the one-two punch and the bears are taking advantage,” said Daniel Ives, chief strategy officer and head of technology research at GBH Insights.
The Dow Jones closed down almost 400 points and the S&P 500 slid by more than 1 percent after earlier sell-offs around the world.
European markets faltered as anxiety mounted in Italy, where Reuters reported voters may head back to the polls in [July](https://www.reuters.com/article/us-italy-politics/italy-banker-warns-on-political-crisis-as-investors-fear-for-euro-idUSKCN1IU18I) after parties failed again to form a governing coalition, and President Sergio Mattarella may dissolve parliament and call for a new vote.
Italy, the bloc’s fourth largest economy and a founding member of the eurozone, hasn’t had a government since national elections in March.
A handful of populist, anti-EU parties won at the polls, but none of them garnered enough seats for an outright majority. The leading Five Star Movement has been unable to cobble together a government with anti-immigrant nationalists.
Investors worried the rising eurosceptic sentiment and political turmoil in Italy could spill over to other European Union countries and further erode the institution that has united most of the continent for more than 60 years.
“There’s hypersensitivity here to what’s happening in Europe,” Ives said.
As Europe fretted over Italy's political future, the Trump administration [announced](https://www.whitehouse.gov/briefings-statements/president-donald-j-trump-confronting-chinas-unfair-trade-policies/) Tuesday it will move forward with 25 percent tariffs on $50 billion worth of Chinese imports, a move that rattled the markets and surprised China. The White House said the tariffs would apply to goods "containing industrially significant technology,” and a list of specific imports will be released next month.
The administration’s decision to spurn Chinese imports comes more than a week after Treasury Secretary Steve Mnuchin said a trade war between the world’s largest economies was “on hold” while negotiations continued.
“We feel surprised by the tactical statement issued by the White House, and yet it was also unsurprising,” a Chinese official [reportedly](https://www.nytimes.com/2018/05/29/business/white-house-moves-ahead-with-tough-trade-measures-on-china.html) said Tuesday in a statement carried by the official Xinhua news agency.
For the full interview, [click here](https://cheddar.com/videos/political-uncertainty-spurs-market-sell-off).
Orangetheory Fitness is redefining the future of workouts with smarter tech, strength-based programming, and community-driven studios built for what’s next.
Spain's government has fined Airbnb 64 million euros or $75 million for advertising unlicensed tourist rentals. The consumer rights ministry announced the fine on Monday. The ministry stated that many listings lacked proper license numbers or included incorrect information. The move is part of Spain's ongoing efforts to regulate short-term rental companies amid a housing affordability crisis especially in popular urban areas. The ministry ordered Airbnb in May to remove around 65,000 listings for similar violations. The government's consumer rights minister emphasized the impact on families struggling with housing. Airbnb said it plans to challenge the fine in court.
Roomba maker iRobot has filed for Chapter 11 bankruptcy protection, but says that it doesn’t expect any disruptions to devices as the more than 30-year-old company is taken private under a restructuring process. iRobot said that it is being acquired by Picea through a court-supervised process. Picea is the company's primary contract manufacturer. The Bedford, Massachusetts-based anticipates completing the prepackaged chapter 11 process by February.
Serbia’s prosecutor for organized crime has charged a government minister and three others with abuse of position and falsifying of documents related to a luxury real estate project linked to U.S. President Donald Trump’s son-in-law Jared Kushner. The charges came on Monday. The investigation centers on a controversy over a a bombed-out military complex in central Belgrade that was a protected cultural heritage zone but that is facing redevelopment as a luxury compound by a company linked to Kushner. The $500 million proposal to build a high-rise hotel, offices and shops at the site has met fierce opposition from experts at home and abroad. Selakovic and others allegedly illegally lifted the protection status for the site by falsifying documentation.
Wealthfront’s CFO Alan Iberman talks the $2.05B IPO and the major moment for robo banking as the company bets on AI, automation, and “self-driving money."
