Trump threatens 25% tariffs on all Chinese goods from Friday

USA equity futures fell more than 2 percent and stocks across trade-reliant Asia tumbled, with China's main indexes plunging 5 percent.

The deployment sends a clear message to Iran that any attack on USA interests or its allies will be met with "unrelenting force", US national security adviser John Bolton said on Sunday. Hopes for a trade deal and the US Federal Reserve backing away from raising interest rate have powered financial markets to the highest levels for six months - making them more vulnerable to bad news.

Adding to the mix, North Korea carried out a weapons test, that potentially included its first ballistic missile launch since 2017, challenging Trump's bottom line in nuclear talks. Late a year ago, Trump had threatened to hike tariffs on Chinese imports if a trade deal was not struck by March 1. So far, the president's desire to preside over a booming stock market has won out over his long-standing protectionism - despite it being one of the few policy areas where Trump has expressed a consistent ideology through his decades intermittently commenting on politics. He would not say exactly who might attend the talks. The S&P 500 was down 26.59 points, or 0.90%, at 2,919.05 and the Nasdaq Composite was down 81.04 points, or 0.99%, at 8,082.96.

"Go have a look at the Chinese stock market, I smashed it", read another popular meme on Chinese social media, this one showing Trump in normal attire and with a smug look on his face.

U.S. stock futures pointed to a lower open on Wall Street. Those firms can choose to pass the cost on to their customers through high prices, absorb the cost and lower their profits, or try to negotiate the cost of the goods down.

At least investors in Japan and South Korea were saved from the rout as the markets were closed there, while Australia's ASX 200 dropped about 1% before recovering slightly and Singapore was down more than 3%.

The Chinese have retaliated by targeting $US110 billion in American imports. The Bloomberg Dollar Spot Index rose 0.3 percent.The euro slipped 0.1 percent to $1.1192.

Japanese markets reopen Tuesday after an extended Golden Week holiday period that included the May 1 ascension of Emperor Naruhito to the Chrysanthemum Throne.

"China's position is always clear-cut and US knows that", Geng said at the Foreign Ministry's regular press briefing, describing recent rounds as making "positive progress".

He said the opposing party will not be successful if it moves forward with impeachment, based on his economic record, in spite of the worldwide stock selloff connected to his rage-tweeting at China. China wants the tariffs to be lifted, while Trump wants to keep some, if not all, of them as part of any final deal to ensure China lives up to its commitments, a White House official said on Sunday.

"The FX markets are reacting in a classic risk-off manner, with the Dollars trading mainly higher".

The euro weakened to $1.1193 from $1.1200 on Friday.

Oil prices, which have been steadily rising all year, fell slightly.

The June crude contract was down 38 cents at US$61.56 per barrel and the June natural gas contract was down 3.7 cents at US$2.53 per mmBTU.

  • Zachary Reyes