The Dow Jones Industrial Average slipped by 205.16 points or 0.78% at the opening bell on Monday as concerns over the ongoing trade war tension between the U.S. and China continued.
The S&P 500 fell by 19.25 points or 0.66%, while the Nasdaq Composite edged lower by 57.82 points or 0.73%.
The trade war shocked global markets last week, which caused U.S. markets to witness a volatile fluctuation. The two nations were attempting to settle negotiations, however, U.S. President Donald Trump decided to implement an additional 10% tariff on USD 300 Billion worth of Chinese goods starting on September 1st.
In retaliation, China devalued its currency in order to soften the damage dealt by Trump’s tariffs. Last week, The People’s Bank of China (PBOC) set the official reference rate of the yuan at 7.0039 yuan per dollar, marking the lowest level since 2008. Regardless, the reference rate was higher than what investors had anticipated.
On Monday, PBOC set its daily midpoint for yuan trading at 7.0211 per dollar, the third consecutive session below the level of 7 per dollar.
Trump mentioned that he would continue to hold talks with China, but noted that Washington was not prepared to make a deal for now.
Global markets were also rattled by the ongoing matters in Hong Kong. Losses continued after Hong Kong International Airport cancelled all departures for the remainder of the day, citing concerns over intensifying protests.
The protests began back in June and challenged China’s President Xi Jinping. The protests have troubled the Asian financial markets for the past several months as over 600 people have been arrested since the start.
After experiencing a rather stronger period during June and July, U.S. markets turned bearish during the month of August. Since the beginning of August, the Dow Jones has fallen by over 1,000 points.