Stock markets around the world have fallen after a sharp escalation in the United States trade war with China.
Indices in the US fell after the open, amid fears of an economic slowdown if President Donald Trump follows through on his threat to impose a further 10 per cent tariff on $300bn worth of Chinese imports from September.
The Dow Jones fell one per cent, while the S&P 500 fell 0.9 per cent and the Nasdaq dropped 1.7 per cent.
Tech companies showed weakness, with chip makers such as Advanced Micro Devices, Intel and Nvidia under pressure. Apple shares also fell, hitting a week-long low.
Spreadex analyst Connor Campbell said: “Entering a bloodied battlefield, the index itself already having lost a limb last night, the Dow Jones dove 200 points after the bell rang on Wall Street, dragged below 26,400 for the first time since mid-June.
“For context, it opened the week pushing 27,250, only to be undone by a not-dovish-enough rate cut from the Fed and Trumps shock-but-not-shocking tariff threat towards China.”
In Asia, Japans Nikkei index fell 2.1 per cent today, while Hong Kongs Hang Seng fell 2.4 per cent.
Meanwhile in Europe, Germanys Dax was down 2.9 per cent this afternoon, while the FTSE 100 continues its torrid day with a 2.4 per cent drop.
CMC Markets analyst Michael Hewson added: “Its been another bad day for European markets with the FTSE100 down for the fourth day in succession, while the rest of Europe has also posted large weekly losses, after President Trump threw all the trade chess pieces up into the air.”
China warns of retaliation
China, meanwhile, said today it would not be blackmailed by the US President, and warned that it could “take the necessary countermeasures to protect the countrys core and fundamental interests”.
“We wont accept any maximum pressure, intimidation or blackmail. On the major issues of principle we wont give an inch,” a spokeswoman added.
China said it hope the US would “give up its illusions” and return to negotiations based on mutual respect and equality.
Gregory Daco, chief US economist at Oxford Economics, said: “Coming on top of existing tariffs, the impact of this shock could be amplified by tightening financial conditiRead More