Markets tumble as trade war escalates

U.S. stocks and commodities tumbled Monday after China retaliated with higher tariffs on a range of American goods. Meanwhile, Treasurys jumped as investors fled to safe havens. The S&P 500 headed for the biggest slide in four months and the Dow Jones Industrial Average slumped more than 500 points after China targeted some of the nation's biggest exporters. Boeing dropped 4.2%, Caterpillar Inc. fell 4.8% and Apple Inc. lost 5.2%. More: Wealthy US investors sitting on cash despite optimism in economy The new penalties also took aim at American farmers, pushing down soybean and cotton prices. Shares came off lows in afternoon trading as President Donald J. Trump indicated he'll speak with China's Xi Jinping at the end of June during the G-20 summit and said he hasn't yet decided about fresh tariffs on the remaining $300 billion in Chinese imports. More: ETF investors see gyrating markets over next six months Trade rattled financial markets again, with stocks sinking for the fifth time in six sessions since China's defiance of Mr. Trump's warning not to retaliate for his imposition of higher tariffs Friday escalated the skirmish, driving demand for havens from gold to the yen while punishing risk assets. Several banks have warned that the eruption increases the likelihood of a slowdown in global growth that would dent corporate profits. "China retaliating as fast as they did was a clear signal they're not going to be pushed around," said Samantha Azzarello, global market strategist for JPMorgan ETFs. "Markets would like a little bit more play nice and maybe even a bit of complacency from China. It was interesting it wasn't done on the weekend. It was done just in time, Monday morning for markets to open." More: Average Fidelity 401(k) balance increases sixfold over past decade to almost $300,000 Elsewhere, European shares dropped more than 1% after the European Union said it was finalizing a list of U.S. goods to target in the event Mr. Trump imposes levies on car imports. Oil turned lower after rising earlier on concerns about rising tensions in the Persian Gulf. Bitcoin climbed above $7,000 as the recent gains in cryptocurrencies extended over the weekend.