Anxiety over Trump's trade war with China causes stocks to plunge on Wall Street - Global News

NEW YORK  — Stocks are plunging on Wall Street Monday on worries about how much U.S. President Donald Trump’s escalating trade war with China will damage the economy. Major U.S. indexes are headed for their biggest drops since early last year.Story continues belowChina let its currency, the yuan, drop to its lowest level against the dollar in more than a decade, a move that Trump railed against as “currency manipulation.” It followed his own tweets last week that threatened tariffs on about $300 billion of Chinese goods, which would extend tariffs across almost all Chinese imports.The escalations in the trade war between the world’s largest economies are rattling investors already unnerved about a slowing global economy, falling U.S. corporate profits and possibly too-weak inflation.READ MORE: China ready for U.S. trade talks, but ‘if they want to fight we will fight’: ambassador“The Great China Trade Deal evaporated before our eyes last week and investors should stop hoping it back into existence,” Christopher Smart, head of the Barings Investments Institute, wrote in a report.Losses were steep and worldwide as the sell-off that began Monday in Asia swept westward through Europe to the Americas. Investors in search of safety herded into U.S. government bonds, which sent yields plunging lower.The yield on the 10-year Treasury note, which rises with expectations of stronger economic growth and inflation, fell to its lowest level since Trump’s 2016 election energized markets, down to 1.73% from 1.85% late Friday. The yield on the 2-year note sank to 1.58% from 1.71% a day earlier. Both are unusually large moves.The Dow Jones Industrial Average sank 861 points, or 3.2%, to 25,620 as of 2 p.m. Eastern time. If it closes there it would be the biggest drop since February 2018.WATCH: China warns retaliation over new tariff threat from Trump

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August 06, 2019 at 03:41AM