The US president is threatening China’s 50% tariffs as Beijing promises to fight trade salbeau “to the end.”
U.S. stocks have been largely closed after a day of wild shaking in the market as investors scrambles to understand President Donald Trump’s tariff plans.
The industrial averages for the benchmark S&P 500 and Dow Jones on Monday fell 0.23% and 0.91% respectively, earning their third conservative loss.
The technology-rich Nasdaq composite rose slightly, up 0.099%.
DIP followed a day of volatile deal followed by unfounded reports that Trump temporarily sent out a 90-day suspension on his tariffs, which increased the S&P 500 by more than 7%.
The Index immediately put on profits after the White House rejected the report. It was featured by many news outlets after it was circulated as “fake news” on social media.
US stock futures, trading outside normal market hours, pointed to possible reprieves from Tuesday’s winning streak, with the S&P 500 and Nasdaq up 0.98% and 1.02%, respectively.
Some Asian markets opened higher on Tuesday after tracing previous losses on Wall Street.
The Japanese benchmark Nikkei 225 rose nearly 6% in early trading.
Hong Kong’s Hangsen has scored more than 2.3% after its biggest plunge in the previous session since the 1997 Asian financial crisis.
Korean Cospi and Australian ASX200 each earned around 1.5%.
However, stocks in Indonesia, Taiwan and Vietnam have been significantly lower.
Despite market turmoil and expressions of concern by top business leaders, Trump on Monday showed he could further escalate the trade war.
In his Platform Truth Social post, Trump said he would slap an additional 50% tariff on China starting Thursday if he did not abolish the 34% retaliation obligation on US imports.
“And further, all consultations with China regarding the requested meeting with us are over!” Trump said.
Speaking later in the White House, Trump said the EU’s proposal to exempt industrial products from tariffs has not progressed well, revealing that his administration “has not seen” the tariff suspension he has announced so far.
China’s Commerce Department on Tuesday fought back against Trump’s latest tariff threat, calling it “a mistake, a mistake.”
“China will never accept this,” a provincial spokesperson said.
“If the US insists on going its own path, China will fight it until the very end.”
US customs officials have begun to impose a baseline tariff of 10% on Sunday imports.
China, the US’s major strategic rival and third-largest trading partner, faces 34% tariffs.
Many US allies have also been hit hard by the export market as the European Union, Japan and South Korea face 20-25% of their duties.