Samer Hasn, senior market analyst at XS.com, said: “S&P 500 futures continued to collapse in early trading this morning, along with global indices, falling nearly 5%. Nasdaq 100 futures also fell nearly 6% at the same time.
“S&P 500 futures officially entered bear territory today, having fallen more than 22% from their all-time highs. US markets are set to dive this week in the bear market, amid gloomy prospects surrounding the US trade war and weak signals regarding the possibility of a settlement to the conflict.
“Tariffs are not new, and markets reacted strongly to them last week. However, Trump’s indications over the weekend that he will maintain the tariffs further frustrate markets, which are clinging to hope for a de-escalation. Trump’s weekend golfing after the widespread market collapses could also be interpreted as a sign of indifference – which he has denied – to the consequences of his recent actions, suggesting he may be sticking to his plan.
“Furthermore, although many leaders of countries affected by the tariffs are inclined to negotiate and make steps that would reduce the tariffs imposed on them, recent signs and reports do not suggest any progress toward a diplomatic solution to the trade war.
“For example, China and the United States have been unable to move forward on the tariff negotiations, and these efforts have failed, ending up in the imposition of massive tariffs on China, which has responded with massive counter-tariffs. This escalation and counter-escalation keeps hope for negotiations slim, according to the Wall Street Journal.”
