Stocks on Wall Street tumbled Friday after President Trump demanded that U.S. companies with operations in China consider moving them to other countries — including the United States — just hours after Beijing announced new tariffs on $75 billion in U.S. goods.
The Dow Jones industrial average closed down more than 600 points, or about 2.4%. The Standard & Poor’s 500 index sank about 2.6%. The Nasdaq composite tumbled about 3%.
Technology companies, which have much to lose in the trade war, bore the brunt of the sell-off. Companies that rely on consumer spending also took losses. L Brands, the parent of Victoria’s Secret, plunged.
Energy stocks fell, along with crude oil prices, as traders worried that the escalation in the trade war could sap global demand for energy.
U.S. bond prices rose sharply as investors sought safety, sending yields down. The price of gold, another haven for investors during times of market turbulence and economic weakness, rose.
In his tweets Friday morning, Trump also said he was “ordering” UPS, Federal Express and Amazon to block any deliveries from China of the powerful opioid drug fentanyl. The stocks of all three companies fell as traders tried to understand what the implications for them were.
Trump also said he would respond to Beijing’s latest tariff increase later Friday.
The developments mark the latest escalation of Trump’s trade war with China. The United States has said it would impose 10% duties on the $300 billion of Chinese goods that were not already subject to tariffs in two steps, on Sept. 1 and Dec. 15. Early on Friday, China said it would retaliate with taxes on $75 billion of U.S. products along the same time frame.
The broad sell-off wiped out all the market’s gains this week, handing the S&P 500 its fourth straight weekly