The stock market responded to Trump’s new threats against China by dropping nearly 500 points, as the president’s tweets sent stocks into a nosedive.
After Trump “ordered” US businesses to see alternatives to China, stocks responded by dropping between 450 and 500 points.
Stocks fell to their lows of the day on Friday after President Donald Trump ordered in a series tweets that U.S. companies find alternatives to their operations in China. Apple led the way lower.
The Dow Jones Industrial Average traded 460 points lower, or 1.8%. The S&P 500 and Nasdaq Composite slid 1.9% and 2.2%, respectively.
“The threats always been out there but there’s been no need to provoke that,” said Art Hogan, chief market strategist at National Securities. “It’s almost like the administration was expecting the Fed to announce a rate cut at the Jackson hole meeting. And since Powell did not deliver, he went to defcon 5.”
Trump can’t make the Fed cut rates. He can’t make US companies stop doing business with China. The only thing that the can do is end the trade war with China, which is the one step that he is refusing to take. A trade deal is not coming. The situation is getting worse by the day. Wall Street is finally starting to realize that consumer spending is living on borrowed time because each escalation of the trade war brings the US closer to higher prices and lower consumer spending.
Trump has tanked the stock market for the second time in less than two weeks, as his irrational outbursts are fueling instability and harming US investment.