China trade war escalates

Stocks slide again on report the U.S. plans more tariffs on Chinese goods

People pass the New York Stock Exchange

Stocks sank again Monday on fears that the Trump administration will escalate its trade dispute with China by imposing tariffs on all remaining imports from China to the U.S.

Further, a recent survey reported by Reuters shows that 85 percent of USA businesses surveyed say they have suffered from the trade war's tariffs, and almost half of the companies reported increases in non-tariff barriers, as well.

"I think that we will make a great deal with China and it has to be great, because they've drained our country", Trump told FOX News Channel's "The Ingraham Angle" on Monday.

The Japanese yen fell 0.4 percent to 112.34 per dollar, the biggest dip in nearly two weeks.

US-China Business Council senior vice president Erin Ennis said that it would not be a surprise to see Trump move towards announcing more tariffs, given his repeated threats to do so. Still, multiple factors make such a drop unlikely, including prospects the US might not go so far and China's various options to sustain growth.

The response on Wall Street was to send the Dow plunging after it had opened by more than 300 points up.

The Russell 2000 index of smaller-company stocks slipped 6.51 points, or 0.4 percent, to 1,447.31. Technology giants rose and the S&P 500 Index posted its biggest two-day surge since February after Facebook's earnings topped expectations. Asian shares were mostly higher on Tuesday as traders took the weaker yuan as a sign that Chinese exports can remain competitive even if a trade dispute with Washington heats up.

China's ambassador to the U.S. said on Tuesday that the "goodwill" and "wisdom" of the Chinese and American people would carry the countries through a tense period in their relations, and that "we have heard enough" of trade war threats and territorial sabre rattling.

The ambassador made no specific remarks about the current trade stand-off between the United States and China. Both were up over 7 percent for the year at the start of October.

On Tuesday, the currency's midpoint was set at 6.9574 per dollar.

The S&P 500, the main benchmark for the US stock market, has fallen 9.9 percent from its latest record high on September 20.

USA crude fell 1.06 percent to $66.33 per barrel and Brent was last at $76.30, down 1.34 percent. The euro rose to $1.1377 from $1.1372.

Benchmark 10-year U.S. Treasury notes last fell 7/32 in price to yield 3.1132 percent, from 3.087 percent late on Monday.

The price of USA crude oil dropped 0.8 percent to $67.04 per barrel in NY while Brent crude, used to price global oils, lost 0.4 percent to $77.34 per barrel in London. Copper was little changed at $2.74 a pound.The dollar rose to 112.35 yen from 111.85 yen.

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