Dow on pace for sharpest drop in 6 weeks as Trump ignites China trade-war fears

U.S. stocks fell sharply Monday morning, joining other global benchmarks, after President Donald Trump threatened over the weekend to increase tariffs on $200 billion of Chinese goods, raising fresh fears about a market-disruptive clash between the world’s largest economies.

How are benchmarks performing?

The Dow Jones Industrial Average DJIA, -0.82%  was down 335 points, or 1.3%, at 26,166, the S&P 500 index SPX, -0.86%  declined 35 points, or 1.2%, to 2,910, while the Nasdaq Composite Index COMP, -0.91% retreated 120 points, or 1.5%, to 8,043.

The declines, if they hold, would be the sharpest for the three major benchmarks since March 22, according to FactSet data. On Friday, the Nasdaq closed at a record, while the S&P 500 narrowly missed finishing at its own.

What’s driving the market?

In a surprise pair of tweets on Sunday, Trump expressed frustration with the speed of talks with China, and threatened to raise tariffs on $200 billion of Chinese goods by Friday to 25% from 10%. “The Trade Deal with China continues, but too slowly, as they attempt to renegotiate. No!” he wrote.

For 10 months, China has been paying Tariffs to the USA of 25% on 50 Billion Dollars of High Tech, and 10% on 200 Billion Dollars of other goods. These payments are partially responsible for our great economic results. The 10% will go up to 25% on Friday. 325 Billions Dollars….

— Donald J. Trump (@realDonaldTrump) May 5, 2019

Trade negotiations were set to resume this week between the two countries and last week U.S. officials had seemed hopeful a deal was imminent. Beijing, which has in the past rejected pressure tactics from the U.S., said Vice Premier Liu He’s planned trip to Washington this week could be canceled altogether, according to a report in the South

Read More Here...

Bookmark the permalink.