President Donald Trump has sent the market tumbling while escalating his trade war with China and threatening a 100 percent tariff “over and above” current rates for Beijing.
The S&P 500 dropped 2.71 percent, while the Dow Jones Industrial Average dipped about 878 points and the NASDAQ Composite slid 3.58 percent by the Wall Street closing bell at 4 p.m. ET Friday.
Stocks had been dropping all day after Trump announced in a lengthy Truth Social post mid-morning a “massive increase of Tariffs on Chinese products,” to “financially counter” the country’s new export controls on rare earth minerals.
“Some very strange things are happening in China!” Trump said. “They are becoming very hostile, and sending letters to Countries throughout the World, that they want to impose Export Controls on each and every element of production having to do with Rare Earths, and virtually anything else they can think of, even if it’s not manufactured in China.”
In a Truth Social post shortly before 5 p.m. ET Friday, Trump announced the whopping 100 percent tax, which would be “over and above any Tariff that they are currently paying,” as well as American export controls on “any and all critical software” — both of which would begin on November 1, “or sooner, depending on any further actions or changes taken by China.”
The Independent has reached out to the White House for more details on the tariff increase.
China’s Ministry of Commerce announced Thursday overseas exporters need to get an export license for items that contain more than 0.1 percent of rare earths from China or are manufactured using the country’s rare earth extraction or refining technology to “safeguard national security and interests.”
Trump said Friday morning Washington’s relationship with Beijing had been “very good” over the last six months, “thereby making this move on Trade an even more surprising one.”
Tensions between the two nations reached a boiling point in April when Trump imposed sweeping tariffs on both enemies and allies, hitting China hard with a 34 percent tariff on imported goods.
China then retaliated with tariffs on imported American goods, and the two countries entered a tit-for-tat tariff war, climbing well beyond 100 percent levies on imported goods from each nation.
Things cooled down in May when Washington brought tariffs on imported Chinese goods down to 30 percent, and Beijing set just a 10 percent tariff on imported American goods.
The Independent has reached out to the Chinese embassy in Washington, D.C., for comment.
Trump also said Friday morning he was supposed to meet with Chinese President Xi Jinping in two weeks on the sidelines of the Asia-Pacific Economic Cooperation summit in South Korea, “but now there seems to be no reason to do so.”
The president later told reporters that he hasn’t canceled his meeting with Xi yet.
“I don't know that we're going to have it, but I'm going to be there regardless. So I would assume we might have it,” he said.
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