Stocks Drop as Trade Battle Intensifies



Steven Russolillo, Lauren Almeida | The Wall Street Journal

Global stocks started the week with sharp declines and the yuan depreciated to a new low as President Trump’s threat to impose more tariffs on Chinese goods continued to rattle investors.

S&P 500 futures dropped 1.5%. Futures don’t necessarily predict moves after the opening bell.

Elsewhere, the Stoxx Europe 600 gauge was down 1.9%, as Germany, the U.K. and France all fell.

“Trump escalating the rhetoric and tariffs puts pressure back on the Fed to do another rate cut,” said Christopher Peel, chief investment officer at Tavistock Wealth.

Government-bond yields continued to plumb new depths Monday on concerns about the global economy being hit by the U.S.-China trade conflict.

The German 10-year bund yield reached a record low at minus 0.573%, and was recently at minus 0.552%. The U.K 10-year gilt hit an intraday record low yield of 0.492%, but has since recovered slightly to 0.506%.

U.S. 10-year Treasurys yields fell to 1.783%, from 1.864% Friday. Bond yields and prices move in opposite directions.

Stocks across Asia fell and the Chinese yuan depreciated to a new low in offshore trading, following the escalation in the U.S.-China trade dispute and amid widespread protests in Hong Kong.

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