Stock futures and oil tumbled as China responded to new US tariffs, marking the resumption of a trade war between the world’s two biggest economies.
S&P 500 futures dropped 0.2% while contracts on the Nasdaq 100 fell 0.3%, erasing earlier gains that were built up on hopes of a deal to delay the levies.
On Monday, President Donald Trump decided to defer imposing tariffs on Canada and Mexico. A gauge of Chinese stocks listed in Hong Kong, which jumped almost 4% earlier, trimmed their advance to 0.8%.
China announced an investigation into Google and put new levies on a range of US products in an apparent retaliatory move, moments after the US tariffs of 10% kicked in.
Trump’s decision to delay imposing tariffs on Mexico and Canada had helped reverse Monday’s risk-off market sentiment and investors were pinning their hopes on a China-US phone call to resolve levies on Asia’s largest economy.
