Wall Street Drops Sharply After U.S. Hikes Tariffs on China
A renewed escalation in trade tensions between the U.S. and China reignited fears of a broader trade war, shaking investor confidence and dragging down markets.
Wall Street reversed early gains and extended losses throughout Tuesday’s session. The downturn deepened during the after-hours futures session, with crude oil (WTI) also sliding to $57 per barrel, fueling growing concerns over a potential global recession.
The Dow Jones Industrial Average, which tracks 30 major U.S. companies, fell 0.84% to 37,645.59. The S&P 500, composed of the most valuable U.S. firms, dropped 1.57% to 4,982.77. The tech-heavy Nasdaq Composite led declines, plunging 2.15% to 15,267.91.
The White House announced the U.S. will raise tariffs on Chinese imports to 104% after Beijing refused to lift its 34% retaliatory duties, originally imposed in response to the Trump administration’s 54% tariff hike on Chinese goods.
Earlier in the day, major indexes had rallied on hopes of renewed negotiations to ease trade tensions. However, those hopes quickly faded following firm statements from U.S. officials.
Among the worst-performing stocks was Apple (-4.98%), hit hard due to its heavy reliance on China, its second-largest market. Other tech giants also slid: Amazon (-2.62%), Nvidia (-1.37%), and Alphabet (-1.40%).
On Monday, Goldman Sachs raised its probability of a U.S. recession to 45%, adding to a growing list of Wall Street leaders—many of whom had previously supported Donald Trump—now voicing concern, including JPMorgan CEO Jamie Dimon and BlackRock CEO Larry Fink.
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