UPDATED with closing numbers An escalation of the U.S.-China trade war Friday, with new tariffs eliciting harsh rhetoric from President Donald Trump, sent U.S. stocks tumbling as the media business kept a wary eye on the situation.
The Dow Jones Industrial Average entered the final minutes of trading at 25,628.90, down 623 points (or more than 2%) for the day. The Nasdaq and S&P 500 saw slightly worse declines of nearly 3%. The slump quickly wiped out market gains for the week, but it wasn’t in historic territory in terms of single-day losses. Nevertheless, the anxiety level was undoubtedly ratcheted up by the back and forth and the market’s reaction, given other fears of a looming recession.
After news of China imposing $75 billion in new tariffs in the months-long trade war, Trump tweeted, “Our great American companies are hereby ordered to immediately start looking for an alternative to China.” He added that the U.S. would be “far better off without” the fellow superpower.
Apple shares dropped nearly 5%, unsettling the market given its status as a Dow component and trade bellwether, but it was the hardest-hit among the tech giants. Major tech firms as well as media companies certainly booked losses, but the damage was generally contained in the 2% to 4% range.
Hollywood has been keeping close tabs on the trade war, but studio sources reached by Deadline indicated it is still not clear how much of Trump’s tough talk will translate to doing business in the region. Sectors like manufacturing, automotive and retail are closer to the front lines. While enthusiasm for China remains healthy, film financing models and studio release plans have long sought to account for the inherent uncertainties in the market.
Trump later in the day didn’t appear to be terribly concerned by the downturn in the stock market. “The Dow is down 573 points,” he tweeted sunnily, “perhaps on the news that Representative Seth Moulton, whoever that may be, has dropped out of the 2020 Presidential Race!”