NEW YORK: Wall Street stocks suffered another bruising sell-off Friday as major indices slumped more than five percent following President Donald Trump's aggressive tariff policies.
US equities spent the entire session in the red, shrugging off solid employment figures and fixating on China's quick retaliation against the US levies.
The broad-based S&P 500 led the major indices lower, ending at 5,074.08, down 6.0 percent for the day and more than nine percent for the week.
The tech-rich Nasdaq Composite Index slumped 5.8 percent to 15,587.79, placing it in a bear market, defined as a 20 percent fall from a recent high.
The Dow Jones Industrial Average tumbled 5.5 percent to 38,314.86, its first close under 40,000 points since August.
The losses increased somewhat following remarks from Federal Reserve Chair Jerome Powell, who warned of the risk of higher unemployment and higher inflation due to tariff increases he characterized as “significantly larger than expected.”
Earlier, government data showed the US economy added 228,000 jobs last month, much more than analysts anticipated.
But markets focused on China's announcement that it was imposing 34 percent tariffs on US imports while also enacting export controls on seven rare earth elements.
“We’ve essentially got an escalating trade war,“ said Jack Ablin of Cresset Capital. “We’re at the beginning of a global slowdown if these tariffs remain in place.”
All 11 sectors of the S&P 500 fell while the Dow index was overwhelmingly a sea of red, with Apple falling 7.3 percent, Chevron 8.2 percent and Boeing 9.5 percent.
But there were a few equities that rebounded.
Nike and Lululemon Athletica rose three percent or more after Trump spoke optimistically about trade talks with Vietnam, from which both companies import apparel. Clothing importers had been among the most hard-hit sectors on Thursday.
Homebuilders were another bright spot in light of falling mortgage rates as markets bet on easing monetary policy. Lennar rose 2.4 percent, while KB Home tacked on 3.5 percent.
