Donald Trump’s announcement that a trade deal with China may not happen until after the 2020 election prompted a drop in US equities, with 400 points being skimmed from the Dow Jones Industrial Average after the comment.
The dip was led by the likes of Apple, Caterpillar and Boeing, all of which are particularly vulnerable to trade fluctuations due to their international footprint.
The Dow was not alone in seeing a dip, however, with the S&P 500 also sliding 1 per cent as chip prices dropped for stocks like Advanced Micro Devices, Micron, and Nvidia, according to CNBC.
The Nasdaq Composite also lost roughly 1 per cent following Mr Trump’s announcement.
The volatility in the market shows the sensitive nature of the trade war Mr Trump has championed since entering office in 2017, and the uncertainty that has followed.
“In some ways, I like the idea of waiting until after the election for the China deal, but they want to make a deal now and we will see whether or not the deal is going to be right,” Mr Trump said on Tuesday.
In response to a question he added: “I have no deadline, no … In some ways, I think it is better to wait until after the election if you want to know the truth.”
Mr Trump is up for re-election this November, where voters will have a chance to grade him directly on his performance as president. So far during his presidency Mr Trump has overseen a strong economy, after years of growth that started during his predecessor’s administration.
The president later responded to the stock market slump by saying the losses are “peanuts” compared to the rate at which the markets have climbed during his presidency.
