Fresh US-China trade war concerns sent the benchmark US equity indices lower on the opening trading day of August, with President Trump announcing that the US would impose an additional 10% tariff on US$300B of Chinese imports that aren't yet subject to US duties - Dow down -281-points or -1.05%, erasing an earlier session rally of as much as 311-points. Caterpillar Inc and Deere & Co - viewed as two bellwethers of global trade - fell -3.71% and -2.68% respectively. The broader S&P500 -0.90%, having climbed as much as +1% earlier in the session. 47 stocks in the S&P500 saw moves of plus or minus 10%. The NASDAQ -0.79%, unwinding an earlier advance of over >1.6%. President Trump announced later in the session that those tariffs could go up a to 25%. There are reports that President Trump ignored the advice of US Treasury Secretary Steve Mnuchin to merely warn China of potential new tariffs. The China Global Times Editor Hu Xijin tweeted that "New tariffs will by no means bring closer a deal that the US wants, it will only make it further away..", adding that "China will no longer give priority to controlling trade war scale, they will focus on the national strategy under a prolonger trade war".
