Dow futures plunge for second day after China retaliates to Trump tariffs
The stock market was headed for another pounding Friday after China retaliated with new tariffs on U.S. goods, raising fears a trade war will tip the globe into a recession.
Futures tied to the blue-chip Dow Jones Industrial Average lost 1,400 points, or 3.3%. Futures levels indicated the Dow would open official trading about 1,500 points lower. This follows a 1,679.39 point decline on Thursday. S&P 500 futures lost 3.5% after the benchmark shed 4.84% on Thursday, News.Az reports, citing CNBC.
Nasdaq 100 futures dropped 4% as many tech companies have exposure to China.
China’s commerce ministry said Friday the country will impose a 34% levy on all U.S. products. This matches the tariff on Chinese goods coming into the U.S. unveiled by President Donald Trump on Wednesday.
Companies with large exposure to China led declines in premarket trading with Apple and Qualcomm down 5% and 6%, respectively. Tesla lost 5% and Caterpillar shed 6%. Nvidia fell about 4%.
Bank stocks tumbled in the premarket as worries of a U.S. economic slowdown grew. Morgan Stanley dropped 5%, while Goldman Sachs shed 4.5%. Citigroup and JPMorgan Chase each slid more than 4%, while Wells Fargo dipped 5%.
The 10-year Treasury yield fell back below 4% Friday as investors flooded into bonds for safety, pushing prices up and rates lower. JPMorgan late Thursday raised the odds of a recession this year to 60% from 40%.
Apple shares tumbled another 5% in premarket trading after China announced retaliatory tariffs against the U.S.
The tech stock is set to add to a 9% decline Thursday after China said it will impose a 34% tariff on all goods imported from the U.S. starting on April 10.
China accounts for around 80% of Apple’s production capacity with about 90% of iPhones assembled in the country, according to estimates from Evercore ISI.
China criticized Washington’s decision to impose 34% of additional reciprocal levies on China — bringing total U.S. tariffs against the country to 54% — as “inconsistent with international trade rules.”
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