US equity futures are stumbling lower following a WSJ report that the Trump administration is expending its China trade war beyond tariffs to counter IP theft.

Nasdaq futures are leading the decline..

Specifically, as The Wall Street Journal reports, the opening move in the new strategy came in the form of a recent crackdown by the Commerce and Justice Departments on a Chinese state-owned chip maker, which the U.S. administration accused of stealing trade secrets from Idaho-based Micron,the people said.

U.S. officials are looking at additional cases where they could use a similar combination of tools to fight Chinese IP theft, the people added. The officials hope that the unprecedented actions taken to defend Micron - the largest American memory-chip maker - will encourage more U.S. companies to work with the government to counter intellectual property theft.

More pointedly, WSJ notes that the initiative opens a new front in Washington’s commercial standoff with Beijing, after the world’s two largest economies engaged in a tit-for-tat exchange of tariffs on each others’ imports over U.S. accusations of unfair Chinese trading practices.

The new blueprint will only work in certain cases and requires extensive resources and interagency coordination to address the thefts on a case-by-case basis, with the Commerce Department has broad authority to restrict U.S. exports to entities it believes could undermine national security.

As we noted previously, it is clear from this escalation that Navarro is very much in charge of the trade 'discussions' still.

One thing is for sure - as we remember 100 years ago the war to end all wars - a new war is just getting going on a very different front.

Yuan is not really reacting to these headlines (after tumbling overnight)...

For now, the post-Midterms gains have been erased...