US stocks plummet as China announces trade war retaliation involving currency value and farm purchases
- Dow, Nasdaq and S&P plunge as Beijing allows the yuan to weaken below 7 to the US dollar and says it will stop buying US agricultural goods
- Technology stocks are among the hardest hit, as the sector stands to suffer more than others if the trade war keeps escalating
US stocks plunged on Monday as the trade war between the world’s two largest economies escalated, with China retaliating against the latest tariff threat by US President Donald Trump.
The Dow Jones Industrial Average dropped 767 points, its worst day of the year. The S&P 500 index fell 2.98 per cent and the Nasdaq composite 3.47 per cent.
“China’s retaliatory strategy to the US appears to be death by a thousand cuts. China has methodically delivered a wave of negative news that is hitting President Trump where it hurts, the US stock market,” Edward Moya at foreign exchange broker Oanda Corp wrote on Monday.
Technology stocks were among the hardest hit, as the sector stands to suffer more than others if the trade war continues to escalate. Apple fell more than 5 per cent and Intel 3.5 per cent.
“Apple is the poster child of the trade war,” said Dan Ives, a tech analyst at Wedbush Securities. “This is a clear gut punch as Apple has bet the farm on China both from a demand and supply perspective.”
