China just slapped an extra 34% in tariffs on U.S. goods. It’s the biggest move yet in its trade war with President Trump. The move shook investors and sent global markets into a tailspin.
Beijing didn’t stop there. It added export controls on rare earths and filed a formal complaint with the World Trade Organization. China also expanded its "unreliable entity" list, targeting 11 more foreign companies.
Some of those companies are tied to arms sales to Taiwan. China sees Taiwan as part of its territory and isn’t backing down. These steps let Beijing punish foreign firms in a big way.
Trump raised U.S. tariffs to their highest in over a century. Countries from Canada to China are firing back. Global markets took a dive after the announcement.
JP Morgan raised its global recession odds to 60%, up from 40%. China’s new tariffs sent U.S. futures tumbling. Wall Street braced for another rough day.
"China comes out swinging with an aggressive response to Trump's tariffs," said Stephane Ekolo of Tradition in London. "This is significant and is unlikely to be over, hence the negative market reactions." Investors fear a never-ending tit-for-tat war.
Big Tech took a hit before the markets even opened. Apple and Nvidia—both reliant on China and Taiwan—fell fast. Their manufacturing ties are too deep to ignore.
Japan felt the pressure too. Prime Minister Shigeru Ishiba called the situation a "national crisis." Tokyo’s banking stocks plummeted, dragging the market toward its worst week in years.
U.S. Secretary of State Marco Rubio pushed back. “Their economies are not crashing,” he said. “The markets are reacting to a dramatic change… The markets will adjust.”