Stocks dropped on Monday after U.S-China trade talks intensified. President Trump threatened to increase U.S tariffs on $200 billion in Chinese imports to 25% up from the current 10%. Now, investors are weighing the situation to see if the conflict could hamper economic growth. Chinese officials are still planning to visit the U.S this week but delays could now be considered.
Bond prices are slightly up, and the 10-year treasury is yielding 2.49%. As for the global economy, tariffs may have a negative impact. Since U.S. and foreign manufacturing data is already a weak, higher tariffs would hurt economic growth. Giovanni Staunovo, analyst at UBS, stated that, “Trump’s latest tweet on trade talks with China has sparked a risk-off environment, adding to the concerns of slowing global economic growth.”