US stocks join global selloff on trade war fears
New York (AFP)
US stocks tumbled early Friday, joining a global selloff amid fears of a trade war after President Donald Trump vowed to impose reciprocal tariffs on all imports in addition to steep tariffs on steel and aluminum.
About 20 minutes into trading, the Dow Jones Industrial Average had fallen 1.3 percent to 24,280.76, and was on track for its fourth straight loss.
The broad-based S&P 500 dropped 1.0 percent to 2,655.63, while the tech-rich Nasdaq Composite Index shed 1.2 percent to 7,094.40.
Trump doubled down on the plan, saying on Twitter that "trade wars are good and easy to win" and threatening to cut off countries that take advantage of the US, while imposing import taxes equivalent to what American goods face.
Equity markets in Paris and Frankfurt were both down more than two percent and the Nikkei in Japan shed 2.5 percent as US trading partners and several leading industry groups criticized Trump's plan.
Oxford Economics warned of "tit-for-tat" retaliation from other countries and said the tariffs could "embolden" Trump to take more punitive actions if the maneuver is "deemed a political success."
"While we are still far from a full-blown trade war that could threaten the global recovery, Trump's actions have increased the risks of such a downside event," Oxford Economics said in a research note, but that was published before Trump raised the stakes and threatened to impose tariffs on all imports.
Blue-chip companies with big declines included Boeing and McDonald's, which both fell more than three percent and Nike, which lost 2.6 percent.
Large technology companies were also down sharply, with Amazon, Facebook, Google-parent Alphabet and Microsoft all off more than one percent.
© 2018 AFP