"The third anniversary of the bull market took an unexpected turn on Friday as President Donald Trump's latest comments on China sent shockwaves through financial markets, erasing 2% from the S&P 500 in a single trading session. What was expected to be a modest celebration of America's longest stretch of market gains in a decade quickly transformed into another episode of geopolitical brinkmanship, this time over the world's most strategic resources: rare earth metals and a fresh round of Chinese import restrictions."
"Investors entered Friday morning with cautious optimism. The S&P 500 had drifted higher for much of the week, setting fresh record highs along the way. But by midday, sentiment had shifted sharply after Trump issued a lengthy Truth Social post stating, among other things, that the U.S. is considering a "massive increase of Tariffs on Chinese products" coming into the U.S. "Some very strange things are happening in China!" Trump wrote against the backdrop of a scheduled meeting later in October with President Xi Jinping in South Korea, ahead of the Asia-Pacific Economic Cooperation summit."
"Trump wrote that China is "becoming very hostile," arguing that the export controls on rare earths would clog world markets for the precious resource. Repeatedly in 2025, Trump's tariffs-heavy trade regime has been countered by China, which holds the trump card of rare earths, essential for high-tech manufacturing. The S&P 500 slid 2% in afternoon trading, while the Dow Jones Industrial Average dropped more than 600 points. Tech and green energy sectors, both heavily reliant on rare earth minerals such as neodymium and dysprosium, bore the brunt of the sell-off."
President Donald Trump's Truth Social post signaled potential massive tariff increases on Chinese products and warned that China is becoming hostile while imposing rare-earth export controls. The comments coincided with a scheduled meeting with President Xi Jinping and sparked a midday market reversal that erased 2% from the S&P 500 and sent the Dow down over 600 points. Tech and green-energy stocks, heavily dependent on rare earth minerals like neodymium and dysprosium, led the sell-off. Rare earth elements, a group of 17 metals essential for high-tech manufacturing, remain a strategic choke point because China controls a majority of global production.
Read at Fortune
Unable to calculate read time
Collection
[
|
...
]