Last week, Dow Average at the open slumped lower along with the other major indexes after a report had surfaced which indicated that, in the wake of the ongoing US-China trade war China was going to take retaliatory measures and escalate the lasting conflict on tariff with the United States of America. A report which emerged from the ministry of China had indications that China is preparing to raise the tariffs on $75 billion and will be doing so in two batches on September 1 and on December 15. The dates are coincidently same as the dates on which United States is expected to increase import duties on Chinese goods worth $300 billion.
As a consequence, the DOW was down 0.5% or by 130 points at 26,118, the S&P 500 index was down at 2,912 and had witnessed a decline of 0.4% while NASDAQ which is technology driven and therefore sensitive to tariff conflicts was down at 7,947 or by 0.6%. The stock index futures were firmly trading higher before the ringing of the opening bell in anticipation of the St Louis Federal President James Bullard’s comments who had said that it was needed to cut the insurance rates to fight the weakening of growth outside the United Sates. The market is also highly anticipating a speech on monetary policy by Jerome Powell in Jackson Hole which is expected to begin at 10 a.m. Eastern Time.
China in its statement had written that the measures taken by USA has led to the continuously escalating friction between China and US in economics and trade, something that has caused great harm to interests of the two countries and other countries as well as it has endangered free trade.