China said on Monday it would impose higher tariffs on a range of U.S. goods including frozen vegetables and liquefied natural gas, striking back in its trade war with Washington after U.S. President Donald Trump warned it not to.
Trade talks between the USA and China concluded Friday with no agreement and with the US increasing import tariffs on $200 billion of Chinese goods to 25% from 10%.
Within minutes of opening, the Dow Jones Industrial Average was down more than 460 points, or 1.8 percent, while the broad-based S&P 500 also fell 1.8 percent and the Nasdaq shed 2.3 percent.
China's vice-premier, Liu He, listens to U.S. Trade Representative Robert Lighthizer as they exit the office of the U.S. Trade Representative on Friday.
Apple shares were also hit by news that the US Supreme Court gave the go-ahead for a lawsuit by consumers accusing the iPhone maker of monopolizing the market for its software applications and forcing them to overpay.
US tariffs past year triggered retaliation by China, which imposed 25 percent levies on $50 billion worth of USA products including soybeans, beef and pork and lower tariffs on a list of $60 billion in goods.
"Yes, I don't disagree with that, ' said Kudlow, while insisting that 'both sides will pay" - and Beijing more than Washington as Trump's prediction comes true and companies relocate from China to other nations with free or freer USA trade arrangements. "That's why China wants to make a deal so badly!" he said.
US dollar and China yuan notes are seen in this picture illustration June 2, 2017.
"(Chinese President) Xi Jinping cannot lose an election and the (U.S.) president can", Holtz-Eakin said. He added that USA tariffs would remain in place while negotiations remain.
The S&P 500 on Friday racked up its worst weekly decline since December, as Washington raised tariffs on Chinese goods worth US$200 billion to 25 per cent from 10 per cent.
Investors are losing faith that a U.S.
'Their [sic] is no reason for the U.S. Consumer to pay the Tariffs, which take effect on China today, ' he wrote. Also, the Tariffs can be completely avoided if you by from a non-Tariffed Country, or you buy the product inside the United States of America (the best idea). There will be nobody left in China to do business with'.
The economic conflict between the two states started after the USA administration imposed duties on Chinese steel imports.
The trade war escalated on Friday after Trump hiked tariffs on $200 billion worth of Chinese goods, saying China had reneged on earlier commitments made during months of trade negotiations.
"This just got messier and more expensive to the global economy and until we get break here, markets are going to be under pressure", said Art Hogan, chief market strategist at National Securities in NY.
The president suggested that manufacturers who make goods in China could shift production to other countries to avoid the tariffs.
Trump obviously believes he can outlast China, but the country's dictatorship means it might not face as much pressure to blink when the tariffs start to bite.
"It's clear that there is a lot of nervousness around the U.S". Chinese officials said they hoped that the USA side would meet them halfway, describing the standoff as just a "setback".
- Simona Halep makes it to Madrid Opens finals
- Supreme Court rules Apple will face antitrust suit for its iPhone apps
- Billy Donovan tops MI fans' wish list to replace John Beilein
- Apple revamps its TV app ahead of streaming service launch
- 'Game of Thrones' Series Finale Preview: The Last Power Struggle
- Real Madrid 'offer Gareth Bale back to Tottenham in £10m loan'
- Houston Ship Channel partially closed after chemical spill
- Felicity Huffman Pleads Guilty to College Admissions Fraud
- ‘Game of Thrones’ Series Finale Trailer: The Aftermath of Daenerys’ Decision
- More tariff looms over US-China trade talks