Wall Street futures plummeted on Wednesday after China announced a sharp escalation in its ongoing trade war with the United States, raising tariffs on American goods from 34% to a staggering 84%. The move, which comes in retaliation to the U.S.’s 104% tariff on Chinese imports that went into effect earlier today, triggered a broad sell-off across global markets.
At last check, Dow Jones Industrial Average futures were down nearly 700 points, slipping more than 1.5%. S&P 500 futures dropped 1.4%, and Nasdaq-100 futures declined by 1%. The futures are currently witnessing extreme volatility, swinging between gains and losses as traders digest the escalating trade dispute.
This tariff hike by Beijing came just hours after U.S. President Donald Trump’s sweeping 104% tariff on Chinese imports took effect. The Chinese Ministry of Finance confirmed the retaliation, stating the new 84% levy aims to protect the nation’s economic interests.
Earlier, China also published a white paper titled “China’s Position on Some Issues Concerning China-U.S. Economic and Trade Relations”, where it reiterated that while it remains open to resolving disputes via dialogue, it will “fight to the end” if Washington continues its aggressive tariff strategy.
Adding fuel to the fire, China’s Foreign Ministry Spokesperson Lin Jian stated, “If the U.S. insists on fighting a tariff war and a trade war, China will definitely fight to the end.” He further emphasized that Beijing will take “resolute and forceful” steps to defend its economic interests.
Meanwhile, Canada has joined the retaliatory wave, slapping a 25% tariff on auto imports from the U.S., further increasing global trade uncertainty. European stock markets opened lower, and Asian currencies fell to record lows during the day as investors sought safe-haven assets.
Crude oil prices also took a hit, with West Texas Intermediate (WTI) falling over 3.5% to $57.38 per barrel, hitting a four-year low. Brent crude followed suit, sliding 3.58% to $60.62 per barrel, as traders grew fearful that the intensifying trade war could dampen global energy demand.
As global financial markets brace for further shocks, investors now await responses from central banks, particularly the U.S. Federal Reserve, which may be forced to intervene with monetary easing to cushion the impact of trade-driven economic disruptions.
