Stocks tanked again in premarket trading Tuesday after China hit back at the U.S. with fresh trade sanctions, while Treasury Secretary Scott Bessent accused Beijing of trying to damage the world economy.
Beijing sanctioned American shipping units, after Treasury Secretary Scott Bessent said Beijing wants "to pull everybody else down with them"
Kevin Dietsch/Getty Images
Stocks tanked again in premarket trading Tuesday after China hit back at the U.S. with fresh trade sanctions, while Treasury Secretary Scott Bessent accused Beijing of trying to damage the world economy.
China sanctioned the American units of South Korean shipping giant Hanwha Ocean and threatened further retaliatory measures on Tuesday, in the latest attempt to get leverage over the U.S. ahead of trade talks later this month.
The move comes after Bessent criticized China for the fresh export controls on rare earths it imposed last week, which riled President Donald Trump.
“This is a sign of how weak their economy is, and they want to pull everybody else down with them," Bessent told the Financial Times. "Maybe there is some Leninist business model where hurting your customers is a good idea, but they are the largest supplier to the world. If they want to slow down the global economy, they will be hurt the most.”
U.S. stocks had rallied on Monday after Trump had signaled a softer tone over the weekend, but they nosedived again early Tuesday before the open. S&P 500 futures fell as much as 1% early Tuesday, while the Dow Jones Industrial Average slumped 0.6% and the Nasdaq $NDAQ fell 1.3%.
In a series of Tuesday announcements, Beijing said it could roll out more measures. A commerce ministry statement suggested Hanwha Ocean’s subsidiaries had supported investigations by the U.S. government, endangering China’s sovereignty, security, and development interests.
It came after tensions had appeared to cool over the weekend. “Don’t worry about China, it will all be fine!" Trump wrote Sunday on Truth Social, in a sharp about-face just days after threatening to cancel a meeting with Chinese President Xi Jinping later in October and threatening 100% tariffs on China.
Bessent suggested in another interview, this time with Fox News, that Trump and Chinese President Xi Jinping are still on course to meet in South Korea late this month. “The 100% tariff does not have to happen," he said. "The relationship, despite this announcement last week, is good. Lines of communication have reopened, so we’ll see where it goes.”
“President Trump said that the tariffs would not go into effect until November 1," Bessent added. "He will be meeting with Party Chair Xi in Korea. I believe that meeting will still be on.”
Bessent also said: “We have substantially de-escalated.”
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