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Economic angst enveloped every corner of Wall Street as US-China trade tensions escalate, sparking a plunge in stocks, the dollar and oil, with liquidations in US assets pointing to disorder in the financial system.
A day after the biggest stock-buying wave in years, assets tied to the economic cycle are sinking again, with President Donald Trump’s mollifying message on trade talks providing little relief. Investors are rushing to game out how the effective freezing of Chinese trade will impact corporate earnings and growth. The S&P 500 pared its drop to about 3%. The greenback was set for its worst day since 2022. After a brief respite on a solid $22 billion bond sale, longer-dated Treasuries turned volatile again.
Market euphoria flipped back to unease despite Trump’s signals that he’s close to a first deal on tariffs — without naming the country. Concern grew that an escalation of the trade war between the two biggest economies will bring lasting damage to global growth after the White House said US tariffs on China rose to 145%.
Bloomberg Washington Correspondents Joe Mathieu and Kailey Leinz deliver insight and analysis on the latest headlines from the White House and Capitol Hill, including conversations with influential lawmakers and key figures in politics and policy. On this edition, Bloomberg's David Gura is in for Joe. Kailey and David speak with:
- Bloomberg's Shawn Donnan.
- Pangaea Policy Founder Shawn Donnan.
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