Dow Jones plunges 724 points

Wall Street has plunged over fears of a US-China trade war, after the Trump administration moved to impose tariffs on up to $US60 billion ($77 billion) worth of Chinese imports.

Markets at 7:05am (AEDT):

ASX SPI 200 futures -1.5pc, ASX 200 (Thursday’s close) -0.2pc at 5,937
AUD: 77.06 US cents, 54.6 British pence, 62.6 Euro cents, 81.2 Japanese yen, $NZ1.07
US: Dow Jones -2.9pc at 23,958, S&P 500 -2.5pc at 2,644, Nasdaq -2.4pc at 7,167
Europe: FTSE -1.2pc at 6,943, DAX -1.7pc at 12,100, Euro Stoxx 50 -1.7pc at 3,342
Commodities: Brent crude -0.8pc at $US68.90/barrel, spot gold -0.2pc at $US1,328.81/ounce
Mr Trump signed a presidential memorandum that will target the Chinese imports but only after a consultation period.

China will have space to respond, reducing the risk of immediate retaliation from Beijing.

Mr Trump said the move was intended to punish China for alleged intellectual property theft.

Worst day in six weeks

The Dow Jones index has tumbled by 724 points, or 2.9 per cent, to 23,960.

This was its biggest fall since the February 8 sell-off, during which it shed 1,175 points.

As for the S&P 500 and Nasdaq, they also fell by a hefty 2.5 and 2.4 per cent respectively.

European stock markets also suffered massive losses in reaction to the tariff announcement — with steep falls for London (-1.2pc), Frankfurt (-1.7pc) and Paris (-1.4pc).

Industrial stocks were among the weakest performers, with Boeing and Caterpillar sliding by 5.2 and 5.7 per cent respectively.

Technology stocks also fared poorly, with Facebook shares dropping by another 2.7 per cent overnight.

The S&P technology sector was dragged down as well over fears there might be tighter regulation on how these companies use people’s data.

“There’s too much negative sentiment right now,” John Carey, portfolio manager at Amundi Pioneer Asset Management in Boston, said.

“I don’t see anything on the horizon that will reassure people that things are just great.”

Australian market to sink

Following the negative lead from global markets, the Australian share market is likely to fall sharply at the open.

In currencies, the Australian dollar has fallen sharply to 77.06 US cents, 54.6 British pence, 62.6 Euro cents, and 81.2 Japanese yen.

As for how the ASX would fare if a trade war erupted, CMC Markets’ Michael McCarthy told the ABC: “Australia’s resource-heavy share market is likely to suffer more than most other share markets.”

“Industrials and commodities are likely to slump if this continues, so the materials and energy sectors will be hit hard.”