Ernst: Trump tariffs on China are a tax on farm families

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U.S. stock futures were also under pressure, with the Dow showing a loss of 0.8%.

Although not part of the US-China trade spat, Europe is looking fragile as growth has already slowed and the fiscal policy is less of a support compared with the US. The blue chip CSI300 index fell 3.6 percent to 3,621.12. Britain's FTSE 100 gained 0.9 percent to 7,668.

In yet another escalation of President Donald Trump's dispute over trade with China, Trump announced on Monday evening that he's directing the USA trade representative to look into new tariffs of $200 billion on Chinese goods. With bond yields falling, some investors bought high-dividend companies like utilities and companies that make and sell household goods. They have also tried to crack down on China's huge shadow banking sector in which murky forms of lending are kept off banks' official balance sheets. A small handful of countries were given exemptions, but China was not one of them.

Biotechnology firm China Biologic rose 23.3 percent after Chinese investment giant CITIC Capital Holdings offered to buy it in a deal valuing the company at $3.65 billion.

Flags of US and China are placed for a meeting in Beijing on June 30, 2017.

In London, shares in British engines maker Rolls-Royce soared almost 10 percent.

In commodity markets, Brent crude futures fell to a six-week low of US$72.45 a barrel today after reports that top suppliers Saudi Arabia and Russian Federation would likely agree to increase production at the June 22 Opec meeting in Vienna. US crude fell 1.6 percent to $64.80 a barrel in NY, and Brent crude, the global standard for oil prices, fell 0.5 percent to $74.94 a barrel in London.

Steel stocks turned in some of the market's worst performances on the day, as traders anxious about the potential impact of a trade war between the USA and China.

The Dow slid 42.41, or 0.2 percent, to 24,657.80.

The problem with watching Cristiano Ronaldo
Spain would be first in the group if they beat Morocco and if Portugal fail to secure a win against Iran . The only player to have scored more global goals is Iran's Ali Daei on 109 goals.

The S&P 500 index and the Nasdaq composite are also lower.

While Trump is said to have rejected China's offer early this month to increase purchases of USA goods by $70 billion, Chinese Foreign Ministry spokesman Geng Shuang said on Wednesday the two sides had made progress in their three rounds of talks.

But Beijing faces challenges in retaliating directly: China ships far more goods to the United States ($505 billion past year, according to USA figures) than come back in the opposite direction ($130 billion).

He also warned of "additional tariffs" should China retaliate. China and Hong Kong markets were closed for a national holiday.

Oil prices, which were lower in early global trading, steadied ahead of an OPEC meeting where top suppliers are expected to agree to increase global crude supply. "Again and again the USA has been provoking a trade war".

Neither side has yet imposed tariffs on the other in their growing dispute over technology and the US trade gap; the first round is to take effect on July 6.

Trump has been taking potshots at Prime Minister Justin Trudeau and Canada since the end of the G7 summit earlier this month after the prime minister said at a press conference that he told the US president that his steel and aluminum tariffs were "kind of insulting", and that Canada "will not be pushed around" and that it would not hesitate to impose retaliatory measures.

The White House said Monday evening that if China goes through with its promise to retaliate against the U.S. tariffs announced last week, the United States will impose tariffs on an additional $200 billion worth of Chinese goods.