Markets plunge on Trump-China trade battle

U.S. stock markets dropped dramatically Monday after China announced retaliatory tariff increases on $60 billion of U.S. goods.
 
The Dow Jones Industrial Average sank 617 points, or 2.4 percent, falling to 25,324 and returning to a level it first reached in January of 2018.
 
The S&P 500 sank a similar 2.4 percent, closing down 70 points.
 
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The stock market jitters come amid increased trade tensions between the United States and China.
 
President TrumpDonald John TrumpDavid Axelrod after Ginsburg cancer treatment: Supreme Court vacancy could 'tear this country apart' EU says it will 'respond in kind' if US slaps tariffs on France Ginsburg again leaves Supreme Court with an uncertain future MORE raised tariffs from 10 percent to 25 percent on $200 billion of Chinese imports to the United States last week after the two sides failed to reach a deal to end the tariffs.
 
China responded by raising its own tariffs on $60 billion worth of American goods.
 
The fighting led to Monday's sell-off, and has traders worried about further losses in the days and weeks ahead.
 
Trump has defended his tough line with China, arguing it will leverage Beijing into a favorable deal for the United States.
 
“We’re in a great position right now, no matter what we do,” he told reporters attending an event he held at the White House on Monday with Hungary's prime minister.
 
Trump also said he would be meeting with Chinese President Xi Jinping next month and expressed confidence a deal could be worked out.
 
“Yeah, I think China wants to have it," he said. 
 
Separately, European Union trade chief Cecilia Malmstrom said Monday that the EU was finalizing a list of retaliatory tariffs against the U.S. in the event that Trump follows through with new auto tariffs.
 
“We are already preparing a list of possible items that would be on that list,” Malmstrom said in a Monday interview with Bloomberg Television.
 
Trump is expected to decide on the tariffs by Saturday.
 
The battle with the EU began when Trump imposed steel and aluminum tariffs on many top trading partners, and the EU responded with a rash of its own tariffs targeting U.S. products.