Earlier on Friday, Trump had threatened a \u201cmassive\u201d increase in tariffs on Chinese products, rocking markets and adding a fresh dose of uncertainty into trade relations between the world\u2019s largest economies.<\/p>\n
China has become \u201cvery hostile\u201d on trade matters, Trump said in the earlier Truth Social post.<\/a> \u201cI was to meet President Xi in two weeks, at APEC, in South Korea, but now there seems to be no reason to do so,\u201d Trump wrote. The leaders were expected to announce a full-fledged trade deal at the meeting.<\/p>\n Trump added on Truth Social <\/a>that the higher tariff would be enforced starting Nov. 1 \u201cor sooner, depending on any further actions or changes taken by China.\u201d<\/p>\n Currently, the U.S. has tariffs of about 40% on Chinese goods.<\/p>\n Trump also said the U.S. would begin to put export controls \u201con any and all critical software.\u201d<\/p>\n A spokesperson for the Chinese Embassy in Washington, D.C., did not immediately respond to a request for comment on Trump\u2019s post.<\/p>\n The announcements from China and Trump were a sudden escalation in a trade war that had appeared to be cooling off. The perceived certainty of a forthcoming China deal had been pushing stocks higher. But the president\u2019s Truth Social post Friday immediately sent U.S. stocks lower, with the S&P 500 falling 2.7% on the day.<\/p>\n The Nasdaq, which contains many tech companies that do business in China, slid more than 3.6%. The Dow Jones Industrial Average, which tracks the stock prices of 30 large companies, fell almost 900 points, or about 1.9%.<\/p>\n China\u2019s new trade regulations require foreign companies to get special approval to export items that contain even small traces of rare earth elements sourced from China. These critical minerals are needed in a broad range of products, from jet engines, radar systems and electric vehicles to consumer electronics including laptops and phones.<\/p>\n China and the U.S. have held more than three rounds of trade talks this year, with rare earths, TikTok and tariffs featuring in the discussions. After talks in Geneva in May, the administration said China had decided to ease up on rare earth export controls.<\/p>\n In June, the two sides met again in London, where they announced yet another agreement on the issue. After those talks, <\/strong>the U.S. said it expected the issue to be \u201cresolved.\u201d<\/p>\n In a Truth Social post<\/a> after those negotiations, Trump said that \u201cour deal with China is done.\u201d<\/p>\n \u201cFull magnets and any necessary rare earths will be supplied, up front, by China,\u201d he added.<\/p>\n \u201cThey were kind of releasing them, but it was going a lot slower than some companies believed was optimal,\u201d National Economic Council Director Kevin Hassett said of China\u2019s rare earth exports at the time.<\/p>\n But U.S. companies have said throughout the talks that the flow of rare earth exports from China has been staggered at best. China dominates the supply<\/a> of these critical minerals, leaving companies few other options.<\/p>\n A full-fledged trade deal with China remains elusive despite the extensive negotiations.<\/p>\n Just as with rare earths, U.S. officials said in September that China had struck a \u201cframework for a TikTok deal.<\/a>\u201d However, in the following weeks, China has not confirmed that such a deal was agreed to.<\/p>\n Many experts believe China\u2019s strategy is to keep talking while making few concrete agreements.<\/p>\n![\"Soil](\"https:\/\/media-cldnry.s-nbcnews.com\/image\/upload\/t_fit-760w,f_auto,q_auto:best\/rockcms\/2025-10\/251010-china-rare-earths-mn-1130-4810c6.jpg\")