Stock futures for the Dow (INDU), S&P 500 (SPX) and Nasdaq (COMP) are all in the red, down around 0.5%. The S&P and Nasdaq have closed lower for the past four days in a row. For the week, the three stock indexes are all down more than 2.5%.
In the latest development in the China-US trade spat, American tariffs on $200 million worth of Chinese goods increased from 10% to 25% at 12:01 am ET on Friday.
Beijing expressed "deep regret over the development" and reiterated that the possibility of retaliatory sanctions.
Amid all this, Chinese Vice Premier Liu He arrived in Washington on Thursday for the latest round of talks. President Donald Trump tweeted that the negotiations continue "in a very congenial manner" bur also spoke out in favor of his tariff strategy.
Trump also said "the process has begun to place additional tariffs at 25% of the remaining 325 billion dollars" worth of goods.
Markets went on a wild ride this week, as investors had assumed a trade deal between the world's two largest economies was close. Instead tensions escalated once again.
Analysts at Goldman Sachs pointed out on Thursday that the new tariffs didn't affect goods that are already in transit, which gives negotiators a short window before they really take effect. Thus, this week's talks are seen as crucial to get back on the path for an agreement.
Global stocks bounced back from their earlier losses in the week. European bourses were in the green and Asian stocks closed higher, with the Shanghai Composite Index (SHCOMP) finishing up 3.1%.
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