“The market is reassessing if anything tangible happened at the Trump-Xi dinner,” said one investment strategist.
The Dow Jones Industrial Average fell by more than 700 points in Tuesday trading, continuing a shaky start to the week prompted by confusion over a thaw in U.S.-China trade relations.
The Dow fell by as much as 719 points, or 2.8 percent, by mid-afternoon Tuesday — for a total drop of 800 points. The S&P 500 lost 2.8 percent of its value, and the Nasdaq fell by 3.3. percent.
The decline on the blue-chip Dow came just one day after a 300-point rally, with investors cheering news that President Donald Trump and China’s President Xi Jinping had settled their differences at the G-20 economic summit over the weekend.
Trump announced via a weekend tweet that China would “start purchasing agricultural product immediately,” and that “China has agreed to reduce and remove tariffs on cars coming into China from the U.S.” Treasury Secretary Steven Mnuchin echoed the positive sentiment, telling CNBC on Monday, “This is the first time that we have a commitment from them that this will be a real agreement.”
On Tuesday, Trump tweeted, “The negotiations with China have already started. Unless extended, they will end 90 days from the date of our wonderful and very warm dinner with President Xi in Argentina.”