Wall Street took a sharp dip during the trading day amid renewed fears about the protracted trade war between the United States and China.
The Dow Jones Industrial Average closed the week down nearly 160 points, or 0.59%, following an announcement that Chinese trade officials were unexpectedly cutting short their visit to farms in Montana and Nebraska. Both the S&P 500 and the Nasdaq Composite declined a respective 14.72 points, or 0.49%, and 65.21 points, or 0.80%.
As part of a bilateral trade deal between the two countries, President Donald Trump has insisted that China increase its purchases of American agricultural products. China’s delegation was scheduled to engage in two days of negotiations with U.S. officials, laying the groundwork for high-level discussions early next month as the world’s two largest economies seek a deal to end their yearlong financial dispute.
China’s move to end its visit came shortly after the Office of the U.S. Trade Representative granted a round of tariff exemptions on more than 400 Chinese imports. Addressing reporters at the White House early today, Trump said that the U.S. was “making a lot of progress with China.”
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Over the past year and a half, the Trump administration has initiated four tranches of tariffs on Chinese goods. The U.S. leader recently postponed levies on $250 billion worth of Chinese products — representing the combined first three tranches — as a “measure of goodwill” during the celebration of the 70th anniversary of the founding of the People’s Republic of China. The 5% duty increase, originally scheduled to take effect on Oct. 1, will now be imposed on Oct. 15.
However, the fourth group of duties, which would impact $300 billion in Chinese imports — including footwear, apparel and other accessories — has been spread across two dates. On Sept. 1, Washington hit Beijing with a 15% levy on $112 billion worth of those goods. China retaliated by slapping American products with new duties that range from 5% to 10%. Tariffs on the remaining $188 billion will be implemented on Dec. 15.
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