It’s been a tough week for the stock market throughout the board. However, there’s one sector that’s hurting more than all the rest. The only sector presently in a bear market is the energy sector, which fell more than 6 % at the start of the month, making it the number-one worst performer on the S&P 500 Index.
While this already looks as if a worst-case situation for investors, some analysts say that things are literally going to proceed to get worse for global energy markets. One main issue at least partially causing the downturn is a recent escalation of the now more-than yearlong trade war between the US and China, which heated as much as new levels last week when US President Donald Trump tweeted that he can be imposing a further 10 % tariff on a further $300 billion of Chinese items beginning on September first.
China quickly retaliated, predictably following the tit-for-that model that the both sides of trade war have followed since its starting last year, by permitting its tightly controlled currency to drop to its lowest worth in over a decade, exacerbating trade tensions between the two nations by making Chinese items less expensive for US markets and, conversely, making US items extra prohibitively costly for Chinese customers. In an article about this week’s worsening tensions between the US and China, Forbes identified that “the US Treasury has since officially labeled China a ‘Currency Manipulator’ – an action it had not taken because the 1990s when China was also named.”