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).
A big-screen adaptation of the anime “Chainsaw Man” has topped the North American box office, beating a Springsteen biopic and “Black Phone 2.” The movie earned $17.25 million in the U.S. and Canada this weekend. “Black Phone 2” fell to second place with $13 million. Two new releases, the rom-com “Regretting You” and “Springsteen — Deliver Me From Nowhere,” earned $12.85 million and $9.1 million, respectively. “Chainsaw Man – The Movie: Reze Arc” is based on the manga series about a demon hunter. It's another win for Sony-owned Crunchyroll, which also released a “Demon Slayer” film last month that debuted to a record $70 million.
The Federal Aviation Administration says flights departing for Los Angeles International Airport were halted briefly due to a staffing shortage at a Southern California air traffic facility. The FAA issued a temporary ground stop at one of the world’s busiest airports on Sunday morning soon after U.S. Transportation Secretary Sean Duffy predicted that travelers would see more flights delayed as the nation’s air traffic controllers work without pay during the federal government shutdown. The hold on planes taking off for LAX lasted an hour and 45 minutes and didn't appear to cause continued problems. The FAA said staffing shortages also delayed planes headed to Washington, Chicago and Newark, New Jersey on Sunday.
Boeing workers at three Midwest plants where military aircraft and weapons are developed have voted to reject the company’s latest contract offer and to continue a strike that started almost three months ago. The strike by about 3,200 machinists at the plants in the Missouri cities of St. Louis and St. Charles, and in Mascoutah, Illinois, is smaller in scale than a walkout last year by 33,000 Boeing workers who assemble commercial jetliners. The president of the International Association of Machinists says Sunday's outcome shows Boeing hasn't adequately addressed wages and retirement benefits. Boeing says Sunday's vote was close with 51% of union members opposing the revised offer.
The stunning indictment that led to the arrest of more than 30 people — including Miami Heat guard Terry Rozier and other NBA figures — has drawn new scrutiny of the booming business of sports betting in the U.S. The multibillion-dollar industry has made it easy for sports fans — and even some players — to wager on everything from the outcome of games to that of a single play with just a few taps of a cellphone. But regulating the rapidly-growing industry has proven to be a challenge. Professional sports leagues’ own role in promoting gambling has also raised eyebrows.
Tesla, the car company run by Elon Musk, reported Wednesday that it sold more vehicles in the past three months after boycotts hit hard earlier this year, but profits still fell sharply. Third-quarter earnings fell to $1.4 billion, from $2.2 billion a year earlier. Excluding charges, per share profit of 50 cents came in below analysts' estimate. Tesla shares fell 3.5% in after-hours trading. Musk said the company's robotaxi service, which is available in Austin, Texas, and San Francisco, will roll out to as many as 10 other metro areas by the end of the year.
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