Hours after US President Donald Trump announced Thursday that new tariffs would be imposed on Chinese goods, US stocks dropped dramatically.
The Dow Jones Industrial Trade Average fell by 1.05%, which amounts to 280.58 points. The drop comes after the stocks rallied earlier on in the day by upwards of 300 points. The S&P 500 fell by 26.82% and Nasdaq Composite fell by 64.30 points.
Moments prior to the final stock numbers, Trump told reporters outside the White House that he was not concerned about the drop in Dow stocks.
Early Thursday, Trump took to Twitter, saying in a series of tweets that new tariffs would be imposed on some $300 billion worth of Chinese goods, noting that the move would take effect come September 1.
“Trade talks are continuing, and during the talks the US will start, on September 1st, putting a small additional Tariff of 10% on the remaining 300 Billion Dollars of goods and products coming from China into our Country,” Trump wrote, later adding that he “looks forward to continuing our positive dialogue with China” on trade.
Trump’s remarks came just after a US delegation met with Chinese officials earlier this week, the first in-person talks to be had since officials’ May breakdown.
“Trade has always been an issue hanging over the market and whether or not we see an escalation,” Quincy Krosby, chief market strategist at Prudential Financial, told CNBC. “The fact is we’ll surely get a reaction from Beijing.”
Krosby later added that “concerns” had previously bubbled up among traders after the US Federal Reserve announced that it was cutting interest rates. “There were concerns that after the [Federal Reserve] meeting and as earnings season began to wind down, the market would be more susceptible to volatility,” he said.
Following the Fed’s Wednesday announcement, US stocks took a similar tumble, with the Dow falling some 333.75 points.