Financial markets buckled after China escalated the trade war with the U.S., sending American stocks to the biggest drop this year and sparking a rally in global bonds. Gold surged with the yen.
More than $700 billion was wiped from the value of U.S. equities on Monday, with the S&P 500 Index plunging 3% and all but 11 companies in the gauge trading lower. Losses in the Dow Jones Industrial Average surpassed 700 points as Apple and IBM slid at least 4%. The Cboe Volatility Index surged about 40%. The 10-year Treasury yield dropped to the lowest since before President Donald Trump’s election. China’s yuan sank beyond 7 per dollar, a move that suggests the level is no longer a line in the sand for policy makers in Beijing.
