Wall Street starts in the red as trade tensions escalate between the US and China

Stocks fell in morning trading on Wall Street on Tuesday Trade tensions have risen again with China.

The Standard & Poor’s 500 index fell by one percent. The Dow Jones Industrial Average was down 383 points, or 0.8 percent, by 9:57 a.m. ET. The Nasdaq Composite Index fell 1.5 percent.

The decline represents another sharp development for the markets over the past few days. Wall Street fell on Friday on its worst day since April and rebounded on Monday on its best day since May. These fluctuations were driven by changing trade sentiment between the United States and China.

The latest decline comes after China’s Ministry of Commerce banned Chinese companies’ dealings with five subsidiaries of South Korean shipbuilder Hanwha Ocean, criticizing President Donald Trump’s efforts to rebuild the industry in America.

European markets fell and Asian markets fell.

Canada’s main stock index, the Toronto Stock Exchange, was up more than 1 per cent as of 10:00 a.m. Tuesday.

The ongoing trade war between the US and the world has been an unpredictable drag on the market. The trade conflict between the United States and China is probably the most important on an economic level, due to these countries’ status as the world’s two largest economies.

International shipping and shipbuilding have become a major source of contention between Washington and Beijing, with each side imposing new port fees on the other’s ships. These fees went into effect on Tuesday.

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The US economy has so far escaped any significant impact from the broad and ever-changing scale US tariff policy. That could change if countries return to a cycle of retaliatory tariffs and companies pass on more of the higher costs to consumers.

The US government shutdown has halted the usual economic updates on inflation, consumer spending and job growth. Wall Street is looking to the latest round of corporate earnings and forecasts to get a better idea of ​​the broader economic picture.

JPMorgan Chase stock fell 3.8 percent, despite beating Wall Street’s earnings expectations for the fourth quarter. Wells Fargo shares rose 3.5 percent after beating analysts’ expectations.

Healthcare giant Johnson & Johnson’s shares fell 1.8 percent after it announced that it would separate its orthopedic business into an independent company.

Treasury yields have remained relatively steady. The yield on the 10-year Treasury note fell to 4.04 percent from 4.05 percent late Friday. Bond markets in the United States were closed on Monday for a holiday.

-With files from Global’s Ari Rabinovich

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