The S&P 500 (SPX) experienced a sharp drop on Friday after President Trump threatened a “massive increase of Tariffs on Chinese products” and other countermeasures following “very hostile” behavior from China, which includes rare-earth export controls. Trump also said that he is weighing pulling out of an in-person meeting with Chinese President Xi Jinping at the Asia-Pacific Economic Cooperation (APEC) Summit.
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“Dependent on what China says about the hostile ‘order’ that they have just put out, I will be forced, as President of the United States of America, to financially counter their move,” Trump said in a Truth Social post.
China Tightens Rare-Earth Export Rules and Hits U.S. Ships with Fees
Earlier this week, China’s Commerce Ministry said that foreign suppliers must receive China’s approval to export products containing Chinese rare-earth materials when those materials account for 0.1% or more of the product’s total value.
“Our relationship with China over the past six months has been a very good one, thereby making this move on Trade an even more surprising one,” Trump said.
On Friday, China’s Ministry of Transport announced that it would begin charging U.S. ships for docking at Chinese ports, starting at 400 yuan per net ton. The U.S. announced a similar move for Chinese ships in April, with both countries set to begin collecting fees on October 14.
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