Markets fall as Huawei ban raises US-China tension

Markets were mostly lower on Monday.

The S&P 500 fell 0.7 percent while the STOXX Europe 600 tumbled 1.1 percent.

In Asia, the Shanghai Composite fell 0.4 percent but the Nikkei 225 rose 0.2 percent.

Market sentiment was shaken by another escalation in US-China trade tension after US tech companies were reported to have begun to comply with the government’s ban on the supply of software and hardware to China’s Huawei Technologies.

Also, CNBC reported that scheduling for the next round of trade negotiations is “in flux” because it is unclear what the two sides would negotiate.

“The rally at the back end of last week is starting to look like a relief rally, and this move could be the beginning of the next major move lower,” David Madden, market analyst at CMC Markets UK, wrote in a note.