The US President has threatened to impose an additional 50 percent tariff on China, while Beijing vows to fight back against the trade attacks “to the end.”
Investors have been left scrambling to make sense of the President’s plans after a third consecutive day of losses in the stock market.
The benchmark S&P500 and Dow Jones Industrial Average both fell on Monday, with the tech-heavy Nasdaq Composite seeing a small increase.
Reports of a potential 90-day pause on tariffs had briefly lifted the S&P500 by more than 7 percent, but the gains were quickly reversed after the White House dismissed the information as “fake news.”
Despite the market turmoil, the President indicated on Monday that he may escalate the trade war further. He stated that if China did not remove its planned 34 percent retaliatory duty on US imports, he would impose an additional 50 percent tariff starting Thursday.
China’s commerce ministry has denounced the latest tariff threat as a “mistake on top of a mistake,” stating that the country will fight back against the US to the end.
US customs has already begun imposing a baseline tariff of 10 percent on imports, with steeper duties set to take effect against dozens of countries, including China, which faces a 34 percent tariff. The European Union, Japan, and South Korea are also bracing for export market hits, with duties ranging between 20 and 25 percent.
