The Dow Jones Industrial Average was down over 400 points in the early market open Tuesday, making it the sixth straight day the Dow has posted losses.
The latest threat by U.S. President Donald Trump to impose an additional round of tariffs on another $200 billion worth of Chinese goods was proposed “if China refuses to change its practices, and also if it insists on going forward with the new tariffs that it has recently announced.”
Related: Dow Down 400 Points: Impact of Trade Tensions
It’s the latest blow by the Trump administration in escalating trade tensions with China after it was announced last Friday that the U.S. would impose a 25 percent tariff on over $50 billion worth of Chinese goods. The Chinese Commerce Ministry responded like-kind with a 25 percent tariff on $34 billion worth of U.S. goods.
“It’s one thing to retaliate with $50 billion here and $50 billion there but when the [U.S.] president trots out another $200 billion, that’s quite concerning,” said Max Baucus, a former U.S. ambassador to China under President Barack Obama. “This reminds me little bit of an old western … If there’s a gunfight trade war, somebody’s going to get hurt,” he continued: “Trump is going to have to find some way to back down and let China save face so that both sides can back down gradually and respectfully.”
The market selloff was reflected in the S&P 500 being down 1 percent as materials, industrials and the technology sector all fell more than 1 percent. The Nasdaq composite was also down 1.2 percent.
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