Stocks took a dive Wednesday amid growing concerns the U.S. economy may be headed toward a slowdown.
The blue-chip Dow Jones Industrial Average fell more than 500 points, or 1.9% during the morning’s trading. The S&P 500 plunged 1.8%, and the tech-heavy NASDAQ dropped 1.65%.
The plunge came after the Institute for Supply Management reported Tuesday manufacturing activity in the United States fell to a 10-year low in September.
Analysts have warned the U.S. could face an economic downturn amid the protracted trade war with China and a slowing of the global economy. Additionally, while the tax bill passed by the GOP-controlled Congress and signed by President Trump in 2017 were a boon to businesses nationwide in the year after its signing, benefits from tax reform are abating as the trade war takes a toll on companies.
Officials from Beijing are scheduled to meet with representatives from the Trump administration next week for continued trade talks, but the president has not offered a clear timeline for when a trade deal may be reached.
Trump said last month he doesn’t believe an agreement is needed before the 2020 presidential election and downplayed any notion U.S. consumers and businesses are feeling the negative effects of the trade war. Instead, the president has stressed it is China that is bearing the brunt of the ongoing trade tensions and eager to make a deal.
As investors brace for a possible recession, Trump blamed the plunge in stocks on Democrats’ newly launched impeachment inquiry against him and accused his political opponents of damaging the U.S. economy deliberately to unseat him.
“All of this impeachment nonsense, which is going nowhere, is driving the Stock Market, and your 401K’s, down. But that is exactly what the Democrats want to do. They are willing to hurt the Country, with only the 2020 Election in mind!” Trump tweeted.
[Previous coverage: Fox Business host: ‘Our economy is suffering’ as a ‘direct result’ of Trump trade war with China]
All of this impeachment nonsense, which is going nowhere, is driving the Stock Market, and your 401K’s, down. But that is exactly what the Democrats want to do. They are willing to hurt the Country, with only the 2020 Election in mind!
— Donald J. Trump (@realDonaldTrump) October 2, 2019
House Speaker Nancy Pelosi announced the impeachment inquiry last week after a whistleblower filed a complaint in part about a July phone conversation between Trump and Ukrainian President Volodymyr Zelensky.
A transcript of the call released by the White House showed Trump urged Zelensky to investigate 2020 Democratic presidential front-runner and former Vice President Joe Biden and his son Hunter Biden.
The president has rejected accusations he acted improperly on the call, saying instead it was “perfect” and part of his efforts to get to the roots of efforts to meddle in the 2016 presidential election.
