Dow plunges 500 points as US-China brawl on trade

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U.S. stocks tumbled on Friday with the Dow plunging 500 points as China announced retaliatory tariffs on some U.S. goods beginning as early as Sept. 1 and  President Trump threatened to further escalate the trade war.

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China will raise import tariffs between 5 to 10 percent on $75 billion worth of goods. The tariffs will be placed on more thn 5,000 U.S. products.

Ticker Security Last Change %Chg
I:DJI DOW JONES AVERAGES 25753.91 -498.33 -1.90%
SP500 S&P 500 2866.87 -56.08 -1.92%
I:COMP NASDAQ COMPOSITE INDEX 7795.666458 -195.72 -2.45%

Oil also fell on the news. U.S. crude dropped 3.5 percent to $53.44.

Shares of U.S. auto and auto parts makers and major oil producers fell on the news.

Ticker Security Last Change %Chg
GM GENERAL MOTORS COMPANY 36.13 -1.13 -3.03%
F FORD MOTOR COMPANY 8.80 -0.24 -2.65%
FCAU FIAT CHRYSLER AUTOMOBILES N.V. 12.52 -0.26 -2.00%
XOM EXXON MOBIL CORPORATION 68.00 -1.56 -2.25%
CVX CHEVRON CORP. 116.25 -1.48 -1.26%

Federal Reserve Chairman Jerome Powell offered little new insight into the U.S. central bank’s plan for interest rates during the Jackson Hole Economic Symposium in Wyoming on Friday, promising to “act as appropriate” to sustain the record economic expansion. “

“Because the most important effects of monetary policy are felt with uncertain lags of a year or more, the Committee must attempt to look through what may be passing developments and focus on things that seem likely to affect the outlook over time or that pose a material risk of doing so,” Powell said in prepared remarks.

The Fed has been a topic this week with the anticipation of Powell’s speech, plus the release of the minutes of the last central bank meeting in which interest rates were cut by 0.25 percent.

U.S. stocks struggled Thursday after the yield curve inverted again — its third such move in the last seven trading sessions — and a measure of manufacturing indicated contraction for the first time in a decade.

The inverted curve has been a reliable indicator of a coming recession, which has spooked markets.

Wall Street also appeared concerned about the not-exactly-dovish comments by Kansas City Fed President, Esther George, who told FOX Business on Wednesday that the U.S. economy is “doing well,” though she’s not “blind” to the risk around it.

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European markets closed down on Friday. London’s FTSE fell 0.5 percent, Frankfurt’s Dax closed down 1.2 percent and France’s CAC ended down 1.1 percent.

Asian markets finished the day with gains. Tokyo’s Nikkei climbed 0.4 percent, China’s  Shanghai Composite rose 0.5 percent and Hong Kong’s Hang Seng climbed 0.5 percent.

The Associated Press contributed to this article.

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