China lists $50bn of USA goods which could face tariff hikes

Imported nuts from the United States are displayed for sale at a supermarket in Beijing on Monday. China raised import duties on U.S. pork fruit and other products Monday in an escalating tariff dispute with President Trump that companies worry might dep

Shares in USA exporters of everything from planes to tractors were volatile on Wednesday after China proposed duties on key US imports including soybeans, planes, cars, beef and chemicals in retaliation to Trump administration tariff plans.

China's finance ministry applied levies to 106 U.S. products, including airplanes, chemicals and agricultural goods, in response to Washington's decision to tariff $50bn worth of Chinese products last week. That's the thing about a trade fight: both sides gets hurt.

The U.S. Chamber of Commerce said it shares the president's concern with China's conduct but warned tariffs would simply raise prices on U.S. consumers and businesses. Other U.S. carmakers such as General Motors Co. and Ford Motor Co. also manufacture in China.

Chinese factories assemble most of the world's smartphones, computers and consumer electronics. "Investors are hopeful that the final trade agreement will be much more lenient that what has been discussed in the last 12 hours".

Some analysts downplayed the back-and-forth as negotiating tactics. "Taking into account transit trade and service trade, the real gap is only a third of the figure released by the U.S. government".

Investors were wondering, nonetheless, how far one of the worst trade disputes in many years could escalate.

After plunging 501 points at the open, the Dow Jones industrial average finished with a gain of 230 points, or about 1 percent. Chipmakers such as Nvidia Corp, with a 1.7 percent drop, and Intel Corp, with a 1.0 percent decline, were among the biggest percentage losers in that sector.

Shares in United States aerospace giant Boeing Co were last down 3.3 per cent, making it the biggest drag on the Dow, although it was not immediately clear how much the tariffs would affect Boeing's newer products.

China's commerce ministry listed 106 products to be targeted and said a date for the implementation of the tariffs would be announced separately. He said that will stir up political pressure against the trade sanctions.

Still, the threat that Boeing Co. could be caught in trade war crossfire sent the shares down almost 6 percent in morning trading.

The Trump administration has recognized that China and the USA are effectively in an economic cold war, particularly when it comes to high-tech manufacturing.

The US move "severely infringed on the legitimate rights and interests that China enjoys in accordance with the WTO rules, and threatened China's economic interests and security", the MOC said.

China responded on Wednesday to the Trump administration's published list of Chinese exports that could soon be subject to a steep 25 percent tariff.

The larger concern, the commerce secretary said, is the protection of US intellectual property.

"It is not our view to expect risk aversion to sustainably rise, even though nervousness is indeed high", Credit Agricole currency strategist Manuel Oliveri said in the Reuters Global Markets Forum.

"There is no law in China that forces foreign firms to transfer their technology to their Chinese partners", Vice Minister of Commerce Wang Shouwen told a press briefing. On Wednesday, Facebook closed with a small decline, but other big tech names such as Apple and Microsoft closed higher. There has also been a surge of new activity of Chinese hackers targeting Western think tanks, US law firms and the USA maritime industry.

Wholesale gasoline stayed at $1.98 a gallon. Facebook slid $3.35, or 2.1 percent, to $152.76 and Microsoft sank $1.40, or 1.6 percent, to $88.31.

Bond prices were little changed.

A barrel of USA crude fell 92 cents to $62.59 a barrel on the New York Mercantile Exchange while Brent crude, used to price worldwide oils, fell 82 cents to $67.30 a barrel in London. Silver fell 14 cents to $16.25 an ounce and Copper lost 5 cents to $3.01 a pound.

Among refined products, Nymex reformulated gasoline blendstock -the benchmark gasoline contract-rose 0.27 cent, or 0.1%, to end at $1.9768 a gallon, while heating oil futures fell 1.77 cents, or 0.9%, to $1.9773 a gallon.