Global markets plunged Tuesday after President Donald Trump threatened tariffs on an additional $200 billion worth of Chinese imports.
The Dow Industrials and S&P 500 fell more than a percent, but the losses in Asia were more severe. Hong Kong's Hang Seng Index was down nearly 3 percent and China's Shenzhen 300 dropped more than 3.5 percent to its lowest level in almost a year.
"We've been riding this synchronized global growth story for 18 months and China is a key to it," said John Petrides, managing director at Point View Wealth Management. "One of the big fears is, clearly, you derail the Chinese growth story you impact earnings on U.S. stocks, and the air fizzles out of the balloon."
The latest sell-off came as investors braced for a full-blown trade war between the world's two largest economies.
Late Tuesday Trump asked his staff Monday to draw up a list of additional goods that should be subject to a 10 percent import tax in the event China retaliates against the original 25 percent tariff announced on $50 billion of imports last week.
The president said any further retaliation by China to this round would increase the roster of goods by another $200 billion. That would bring the total number of Chinese goods subject to tax to $450 billion, almost 90 percent of all the goods the U.S. imported from that country last year.
Whether that ultimately results in a true "trade war", though, remains to be seen, according to Petrides.
"Be careful with the president's comments: 'We could possibly impose...'," he said. "The president has done this before. He swings for the fences when he's negotiating, and he typically backs down in a more muted fashion. He did this with the corporate tax reform...he's waffled back and forth with some of the allies in terms of the amount of tariffs."
Trump's move on Monday came shortly after the Senate voted to reinstate a ban on Chinese tech company ZTE, barring it from buying components from U.S. manufacturers. Trump has tried to throw a lifeline to ZTE, which has been struggling to survive under U.S. sanctions.
Shares, which had not traded for two months after the sanctions were first announced in April, began trading again last week and fell more than 40 percent. After the Senate's decision Monday, the stock dropped another 25 percent.
For the full interview, [click here](https://cheddar.com/videos/u-s-china-trade-conflict-escalates).
The Rev. Al Sharpton is set to lead a protest march on Wall Street to urge corporate America to resist the Trump administration’s campaign to roll back diversity, equity and inclusion initiatives. The New York civil rights leader will join clergy, labor and community leaders Thursday in a demonstration through Manhattan’s Financial District that’s timed with the anniversary of the Civil Rights-era March on Washington in 1963. Sharpton called DEI the “civil rights fight of our generation." He and other Black leaders have called for boycotting American retailers that scaled backed policies and programs aimed at bolstering diversity and reducing discrimination in their ranks.
President Donald Trump's administration last month awarded a $1.2 billion contract to build and operate what's expected to become the nation’s largest immigration detention complex to a tiny Virginia firm with no experience running correction facilities.
Chipmaker Nvidia is poised to release a quarterly report that could provide a better sense of whether the stock market has been riding an overhyped artificial intelligence bubble or is being propelled by a technological boom that’s still gathering momentum.
Cracker Barrel said late Tuesday it’s returning to its old logo after critics — including President Donald Trump — protested the company’s plan to modernize.
Low-value imports are losing their duty-free status in the U.S. this week as part of President Donald Trump's agenda for making the nation less dependent on foreign goods. A widely used customs exemption for international shipments worth $800 or less is set to end starting on Friday. Trump already ended the “de minimis” rule for inexpensive items sent from China and Hong Kong, but having to pay import taxes on small parcels from everywhere else likely will be a big change for some small businesses and online shoppers. Purchases that previously entered the U.S. without needing to clear customs will be subject to the origin country’s tariff rate, which can range from 10% to 50%.
Southwest Airlines will soon require plus-size travelers to pay for an extra seat in advance if they can't fit within the armrests of one seat. This change is part of several updates the airline is making. The new rule starts on Jan. 27, the same day Southwest begins assigning seats. Currently, plus-size passengers can pay for an extra seat in advance and later get a refund, or request a free extra seat at the airport. Under the new policy, refunds are still possible but not guaranteed. Southwest said in a statement it is updating policies to prepare for assigned seating next year.
Cracker Barrel is sticking with its new logo. For now. But the chain is also apologizing to fans who were angered when the change was announced last week.
Elon Musk on Monday targeted Apple and OpenAI in an antitrust lawsuit alleging that the iPhone maker and the ChatGPT maker are teaming up to thwart competition in artificial intelligence.
