Wall Street plunged after Trump threatened to increase tariffs on China, causing the S&P 500 to drop 2.7%. Stocks were already under scrutiny for high prices, with critics saying the market looked too expensive. Levi Strauss reported strong profits but saw a 12.6% drop in its stock price.

The tariff threat led to widespread drops in the market, with nearly all S&P 500 stocks falling. Oil prices sank following a ceasefire in Gaza, but losses accelerated due to fears of global trade disruptions. The bond market also reacted, with the 10-year Treasury yield falling to 4.05%.

Consumer sentiment remains low, with concerns about high prices and job prospects. The job market slowdown prompted the Federal Reserve to cut interest rates, with potential for more cuts. Inflation expectations edged down slightly, which could help limit upward pressure on inflation.

Stock markets abroad also fell, with indexes dropping in Europe and Asia. Hong Kong’s Hang Seng fell 1.7%, while South Korea’s Kospi jumped 1.7% after a holiday. Overall, the tension between the US and China continues to impact global markets.

Read more at Yahoo Finance: Wall Street drops to its worst day since April after Trump’s threats of tariffs shatter its calm