The Dow Jones Industrial Average is on pace for its worst trading day of the year as the world’s two largest economies continue their tit-for-tat tariff battle in a now-yearlong trade war.
The 30-stock index sank more than 700 points during Monday’s session — on track to record its biggest single-day loss since early January — while the S&P 500 dropped 64 points and the Nasdaq Composite fell 244 points. All three major benchmarks are anticipating their largest losses since December, which saw the worst week of trading since the 2008 financial crisis.
It was also a tough day for footwear stocks, with Dow members Nike Inc. and Walmart Inc. down 2% as of 2:30 p.m. ET. Steven Madden Ltd., PVH Corp., J.C. Penney Company Inc., Gap Inc. and the Columbia Sportswear Company were also in the red — with all companies having previously said that they would need to raise costs for consumers in response to the rising levies.
Washington on Friday imposed a tariff increase from 10% to 25% on $200 billion in Chinese imports, leading Beijing to retaliate with new tariffs of 5% to 25% on $60 billion of United States goods. China’s plan would target about 5,000 products and kick in as soon as June 1.
In a series of tweets this morning, President Donald Trump wrote, “Their [sic] is no reason for the U.S. Consumer to pay the Tariffs, which take effect on China today … Also, the Tariffs can be completely avoided if you by [sic] from a non-Tariffed Country, or you buy the product inside the USA (the best idea). That’s Zero Tariffs. Many Tariffed companies will be leaving China for Vietnam and other such countries in Asia. That’s why China wants to make a deal so badly!”
He added: “There will be nobody left in China to do business with. Very bad for China, very good for USA! But China has taken so advantage of the U.S. for so many years, that they are way ahead (Our Presidents did not do the job). Therefore, China should not retaliate — will only get worse!”
(The three-part tweet has since been deleted but was reposted hours later with the original text corrected.)
Both countries have yet to strike a trade agreement to settle their economic dispute, which also includes discussions on intellectual property theft and their bilateral trade deficit. Leading footwear and apparel organizations have condemned the tariffs, adding that companies and consumers would bear the brunt of those costs.
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