Dow tumbles on trade war fears

Daniel Fowler
April 9, 2018

President Donald Trump said Thursday that "in light of China's unfair retaliation" to proposed US tariffs on $50 billion worth of imports from the country, he had instructed the office of the US Trade Representative to "consider whether $100 billion of additional tariffs would be appropriate". If the S&P trades below it again, that could spur deeper selling ahead.

Stocks added to losses and hit session lows in afternoon trading after Federal Reserve Chairman Jerome Powell said the USA central bank will likely need to keep hiking interest rates to keep inflation under control and said it was too soon to know if rising trade tensions would hit the United States economy.

What are main benchmarks doing?

All 30 companies on the Dow lost ground on Friday. The index briefly fell more than 750 points.

The S&P 500 ended just above its 200-day moving average after trading well below that key support level that is watched by technical analysts. Caterpillar and Boeing, industrial giants that rely on China, led the index's losses. The benchmark index lost 1.4% over the week.

For the week, the S&P 500 was down 1.4 percent, the Dow was down 0.7 percent and the Nasdaq was down 2.1 percent.

The selloff in us stocks deepened Friday as the White House's latest trade bluster rattled global financial markets.

In a radio interview Friday morning, Trump said, "I'm not saying there won't be a little pain, but the market has gone up 40%, 42%, so we might lose a little bit of it".

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"The Chinese side will follow suit to the end, not hesitate to pay any price, resolutely counterattack and take new comprehensive measures in response", the ministry said via its website (, citing an unnamed spokesman. The statement added that China "doesn't want" a trade war, but is "not afraid to fight one".

White House officials, including top economic adviser Larry Kudlow, have sought in recent days to soothe business leaders' fears of a trade war that would constrain economic growth.

The central bank official also noted that the U.S. labor market appeared close to full employment, which could spell an inflationary period that would elevate price levels.

Stocks were mostly unaffected by the March jobs report, which showed that the United States economy added 103,000 positions, down from a much bigger gain in February and well below what analysts were expecting. The US still shows the tightest labor market in almost two decades.

"We view earnings growth as the single most important factor for equities and think that continued momentum should help move the market higher", Wilson said.

Shares of Incyte Corp.(INCY) plunged 23%, and Merck & Co. USA oil stocks fell 2.3% on fears Beijing could restrict crude exports.

Nvidia Corp.(NVDA) sank 3.2 to close at $214.25. Visit for more information on this news. Meanwhile oil prices ( fell sharply on trade war fears, settling 2.3% lower at $62.06 a barrel.

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