Features

Chart of the week: who will suffer most in a trade war?

If the trade war between the US and China worsens, both countries’ growth will suffer as they raise barriers against a wider range of goods and make it harder for foreign companies to gain footholds.

896_COTW

If the trade spat between the US and China worsens, both countries' growth will suffer as they raise barriers against a wider range of goods and make it harder for foreign companies to gain footholds. That would be especially bad news for Germany, where goods exports to the US and China jointly comprise almost 6% of GDP, says Capital Economics. The next most-exposed countries are Australia and New Zealand, which both export 5.5% of their GDP to the US and China. This is a bigger percentage than China and America's direct export exposure to each other. Thirty-three per cent of Australian and 22% of New Zealand goods exports respectively go to China; 3% and 16% to the US.

Viewpoint

"British shares languish in the bargain basement Uncertainty about Brexit, plus the possibility of a Marxist chancellor have [hit] the FTSE 100... the UK stockmarket is trading on a [cyclically adjusted price-earnings ratio] of just over 15, compared with 20 in Germany, 27 in Japan and 30 in America. the global average for emerging markets such as Brazil, Russia, India and China is 17 Ritu Vohora, investment director at the fund manager M&G, calculates that, on one measure, UK shares are now the cheapest they have been since World War II. She bases her view on valuation by dividends or the income that shares pay investors relative to government bond or gilt yields. While the short-term outlook is challenging with elevated risks and international sentiment extremely negative, UK equities or shares are on sale with uncertainty discounted in prices,' she said."

Ian Cowie, The Sunday Times

Recommended

Bondholders beware – inflation is coming, says Jeremy Siegel
Inflation

Bondholders beware – inflation is coming, says Jeremy Siegel

With vaccines promising an end to lockdowns, inflation won't be far behind, warns Jeremy Siegel, professor of finance at Wharton.
26 Jan 2021
Joe Biden’s spending spree will lift American spirits and markets – but it comes with a sting in the tail
US stockmarkets

Joe Biden’s spending spree will lift American spirits and markets – but it comes with a sting in the tail

New US president Joe Biden is planning to throw trillions of dollars in stimulus at his country’s economy. Markets will love that. But it comes with a…
25 Jan 2021
The Arab Spring ten years on: a revolution that failed to blossom
Global Economy

The Arab Spring ten years on: a revolution that failed to blossom

Ten years ago, the Arab world was rocked by mass protests and popular uprisings that ousted long-reviled dictators. For the most part, the end result …
23 Jan 2021
The charts that matter: inflation, bubbles, and booze
Economy

The charts that matter: inflation, bubbles, and booze

As US stocks head higher into bubble territory, John Stepek looks at the charts that matter most to the global economy.
23 Jan 2021

Most Popular

The FTSE 100 is set for a makeover with an influx of new tech stocks
UK stockmarkets

The FTSE 100 is set for a makeover with an influx of new tech stocks

The FTSE 100 – the dullest index in the world – is about to reinvent itself as a host of new firms list on the market. The change is long overdue, say…
24 Jan 2021
Think Tesla is a bubble? This might be the best way to bet on it bursting
Oil

Think Tesla is a bubble? This might be the best way to bet on it bursting

The huge rise in Tesla’s share price means that, by market value, it’s now the sixth-largest company in the US and and the world’s biggest car-maker. …
25 Jan 2021
Why we won’t see a house-price crash in 2021
House prices

Why we won’t see a house-price crash in 2021

Lockdown sent house prices berserk as cooped up home-workers fled for bigger properties in the country. And while they won’t rise quite as much this y…
18 Jan 2021