Escalation of US-China trade tensions spooked investors as Wall Street opened deep in the red on Monday. The Dow Jones Industrial Average fell more than 580 points, or around 2 percent, after the opening bell.

The S&P 500 and the Nasdaq Composite were down 2 percent and 1.3 percent respectively.

US stocks followed the downturn on the Asian markets. Japan’s Nikkei declined 1.74 percent on trade tensions concerns, while Hong Kong's Hang Seng fell 2.85 percent and China’s Shanghai Composite closed 1.62 percent down.

European stocks also tumbled on Monday with the FTSE 100, representing the leading companies listed on the London Stock Exchange, down 2.78 percent. France's CAC 40 dropped by 2.26 percent and Germany's DAX was trading more than 5 percent lower in late afternoon trading.

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US President Donald Trump took to Twitter Monday to call Washington’s trade war rival China a currency manipulator after the renminbi dropped below seven per dollar for the first time in over a decade.

China’s national currency sank following Trump’s earlier threats to hit Beijing with new tariffs in less than a month amid the escalating trade standoff between the two world’s largest economies. The president was quick to say that the move will eventually backfire on China.

“It’s called ‘currency manipulation,’” he tweeted. “This is a major violation which will greatly weaken China over time!”

China dropped the price of their currency to an almost a historic low. It’s called “currency manipulation.” Are you listening Federal Reserve? This is a major violation which will greatly weaken China over time! — Donald J. Trump (@realDonaldTrump) August 5, 2019

It’s not the first time Trump has slammed China for this, but the US Department of Treasury refrained from officially labeling Beijing a currency manipulator, placing it on the monitoring list instead. Apart from China, the list now includes Japan, South Korea, Germany, Italy, Ireland, Singapore, Malaysia, and Vietnam.

The People’s Bank of China (PBOC), which is in charge of the yuan’s exchange rate, blamed the weakening of the currency on the US’ own actions, such as unilateral, protectionist measures, as well as the expectation of additional tariffs on Chinese goods, according to Xinhua. The central bank also said the yuan has strengthened 20 percent against the dollar over the past two decades.

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