Dow drops 350 points after Trump threatens new tariffs on Mexico

(CNBC) Stocks fell on Friday as investors feared President Donald Trump’s surprise threat of tariffs on all Mexico imports, amid a worsening trade war with China, could risk sending the U.S. economy into a recession.

The Dow Jones Industrial Average traded 350 points lower, while the S&P 500 slid 1.4%. The Nasdaq Composite dropped 1.6%. The S&P 500 was already down 5.3% this month through Thursday after trade talks fell apart with China and rhetoric on both sides worsened in May.

“President Trump’s latest trade bombshell … might turn out to be a short-lived threat that is quickly defused by commitments on border security, but it nonetheless looks damaging at a number of levels,” Krishna Guha, head of global policy and central bank strategy at Evercore ISI, wrote in a note.

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