Wall Street Slips After Trump’s Harsh China Comments
New York — U.S. stocks fell Friday after President Donald Trump accused China of violating its trade agreement with the United States. The statement rattled investors already bracing for another round of economic uncertainty.
Trump posted on social media, “China HAS TOTALLY VIOLATED ITS AGREEMENT WITH US. So much for being Mr. NICE GUY!” His comments sent immediate shockwaves through financial markets.
Market Reaction to Trump’s Trade Statement
- The Dow Jones Industrial Average dropped by 130 points (0.3%).
- The S&P 500 and the Nasdaq Composite both fell 0.35%.
- The U.S. dollar saw a slight gain, though the broader dollar index remains down for the fifth straight month.
Wall Street had shown signs of optimism earlier this week after a federal court blocked many of Trump’s tariffs. But that rally quickly faded when a federal appeals court paused the ruling, keeping the future of Trump’s tariffs in limbo.
Legal Uncertainty Over Tariffs Adds to Market Stress
Analysts now believe that Trump’s tariff plan might end up in the Supreme Court. Greg Valiere, chief U.S. policy strategist at AGF Investments, described the situation as “stunning, head-spinning, and mind-boggling.”
Traders are preparing for a prolonged legal and political battle, which could drag on for months.
Inflation and Consumer Spending Trends Weigh In
Adding to the tension, new economic data released Friday revealed mixed signals. The Federal Reserve’s preferred inflation index cooled slightly more than economists predicted. However, consumer spending fell sharply — a concerning sign for future growth.
Markets React to Trump’s Renewed Trade War
Trump has reignited his trade war with China in recent days, creating more volatility just as investors hoped the worst was over. The “Liberation Day” tariffs, as his administration calls them, are now at the center of a growing legal and economic storm.
Despite recent turbulence, May has been a strong month for stocks:
- The S&P 500 is up over 6%
- On track for its best May performance since 1990
- Investors who exited the market earlier this month missed out on significant gains
Still, experts caution that uncertainty remains.
Expert Insights on Market Outlook
“Even though the stock market has rebounded since April, there’s still plenty of confusion around tariffs,” said Clark Bellin, President of Bellwether Wealth.
“Expect more market volatility ahead,” added Ulrike Hoffmann-Burchardi of UBS Global Wealth Management. She pointed to ongoing economic, legal, and geopolitical risks.
