Dow Plunges at the Open Following Navarro’s Tariff Bombshell

Posted in: Markets
Published:
November 11, 2019 2:36 PM UTC
  • The Dow Jones Industrial Average opens sharply lower on Monday.
  • Peter Navarro, President Trump’s assistant, argues forcefully against the idea that a tariff rollback is being eyed as part of a partial trade deal with China.
  • A planned meeting between President Trump and Xi Jinping of China could be pushed back to December, according to Bloomberg.

The Dow and broader U.S. stock market plunged at the open Monday after President Trump’s assistant Peter Navarro squashed rumors about a tariff rollback between the United States and China.

Dow Plunges; S&P 500, Nasdaq Follow

Wall Street’s major indexes pulled back from record highs on Monday, mirroring a volatile slide for Dow futures. The Dow Jones Industrial Average (DJIA) fell 124.32 points, or 0.5%, to 27,556.92.

The Dow Jones Industrial Average follows the futures market lower Monday morning. | Chart: Yahoo Finance

The broad S&P 500 Index of large-cap stocks declined 0.5% to 3,077.15. Losses were mainly concentrated in energy, real estate and utilities stocks.

Meanwhile, the technology-focused Nasdaq Composite Index fell 0.6% to 8,428.46.

Peter Navarro: No Tariff Rollback Planned

Equities surged to record highs last week amid reports that China and the U.S. were planning to rollback tariffs as part of a ‘phase one’ trade agreement. President Trump poured cold water on those rumors Friday, but the market didn’t seem to react as all three U.S. benchmarks closed at record highs.

Peter Navarro, President Trump’s assistant and the director of the Office of Trade and Manufacturing Policy, pushed back forcefully at the prospect of a tariff reduction. In an interview with Yahoo Finance, Navarro said:

There’s no rollback at all. So we need the tariffs there, but the tariffs are really our best insurance policy as well to make sure that the Chinese are negotiating in good faith.

Talks between the world’s largest superpowers have progressed favorably in recent months, culminating in a ‘phase one’ trade agreement announced by President Trump in mid-October. Despite signaling that an interim deal was imminent, the White House has yet to finalize the details with its Chinese counterparts.

President Trump and China’s Xi Jinping were scheduled to meet this week on the sidelines of the APEC summit in Chile before it was cancelled due to violent protests in the Latin American country. As Bloomberg reports, the Trump-Xi trade summit may be pushed back to December.

Samburaj Das edited this article for CCN.com. If you see a breach of our Code of Ethics or Rights and Duties of the Editor or find a factual, spelling, or grammar error, please contact us.

Last modified: November 11, 2019 8:33 PM UTC

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Sam Bourgi @forgeforth87

Financial Editor of CCN.com, Sam Bourgi has spent the past decade focused on economics, markets, and cryptocurrencies. His work has been featured in and cited by some of the world's leading newscasts, including Barron's, CBOE, Yahoo Finance, and Forbes. Sam is based in Ontario, Canada and can be contacted at sam.bourgi@ccn.com or at LinkedIn.