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Stocks - Wall Street Slides as China Increases Tariffs in Trade Retaliation - Investing.com

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Investing.com - U.S. stock markets opened sharply lower on Monday as China announced countermeasures against the U.S. in an escalating trade dispute.

Beijing indicated plans to beginning on June 1 in response to U.S. President Donald Trump’s instructions to Trade Representative Robert Lighthizer to prepare 25% tariffs on virtually all Chinese products imported to the U.S., including those which were not currently covered by existing levies.

That presidential order came after the U.S. increased tariffs last Friday on $200 billion of Chinese imports to 25% from 10%.

Fears that the growing escalation of the Sino-U.S. trade dispute threatens to derail the global economy shook risk assets on Monday.

The tumbled 457 points, or 1.8%, to 25,485.76 points by 9:33 AM ET (13:33 GMT), while the sank 52 points, or 1.8%, 2,829.38 points and the tech-heavy slid 179 points, or 2.3%, 7,738.33 points.

Hu Xijin, editor-in-chief of China’s state-controlled Global Times, singled out Boeing among the Dow components likely to be targeted by the new round of tariffs.

“China may stop purchasing U.S. agricultural products and energy, reduce Boeing orders and restrict U.S. service trade with China,” he said in a tweet, adding that Chinese authorities could also consider dumping their holdings of U.S. Treasuries.

Shares of Boeing (NYSE:) sank 3.4%, topped only by the 4.7% decline in Apple (NASDAQ:), for whom China is an increasingly important market, and a 3.6% slide in industrial global bellwether Caterpillar (NYSE:).

With no major economic data or company reports scheduled for Monday, trade will be driven by any developments with regard to the ongoing dispute.

“Lacking recent precedents, stocks are missing an anchor in the midst of escalating China-U.S. trade tensions,” Mohamed El-Erian, chief economist at Allianz, said via Twitter. “As such, they continue to react to every statement from government officials.”

Outside of equities, the , which measures the greenback against six rival currencies, lost 0.3% at 96.83 by 9:35 AM ET (13:35 GMT), while the fell 4 basis points to a six-week low of 2.41%.

In commodities, rose $12.25, or 1.0%, to $1,299.75 a troy ounce, while jumped $1.50 cents, or 2.4% to $63.16 a barrel.

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https://www.investing.com/news/stock-market-news/stocks--wall-street-slides-as-china-increases-tariffs-in-trade-retaliation-1866171

2019-05-13 13:37:00Z
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