U.S. markets plummeted early Tuesday after China imposed sanctions on U.S. subsidiaries of South Korean shipbuilder Hanwha Ocean, reigniting fears over escalating trade tensions and maritime dominance, despite recent attempts to calm markets.
U.S. markets experienced a significant downturn early Tuesday, with S&P 500, Dow Jones Industrial Average, and Nasdaq futures all sliding, following China's imposition of sanctions on five U.S. subsidiaries of South Korean shipbuilder Hanwha Ocean. This move, which Beijing stated was a response to President Trump's efforts to revitalize the American shipbuilding industry, is seen as a direct challenge to Washington's attempts to counter China's maritime dominance. Hanwha Ocean, which acquired Philly Shipyard and holds U.S. Navy contracts, saw its shares fall 5.8% in Seoul. The sanctions swiftly erased a brief period of market calm, which had followed Trump's reassuring social media post on Sunday. The escalating trade friction, also marked by new port fees between the two nations, impacted global markets, with declines seen across Europe, Japan, Hong Kong, and Shanghai. Amidst the geopolitical tensions, investors were also digesting a wave of corporate earnings reports; JPMorgan Chase and Wells Fargo both surpassed analyst expectations, though JPMorgan's shares still dipped slightly, while Domino's also reported strong results. Japan's market faced additional headwinds from domestic political uncertainty. Energy prices for both U.S. and Brent crude also fell.
