Already, in a separate move, the United States is drawing up a list of about $50 billion in Chinese imports to tax in an effort to punish Beijing for stealing American technology or forcing US companies to hand over trade secrets.
Tariffs on each side totaling $3 billion sounds like a lot of money, but is a small percentage of all the goods and services traded between the two nations.
The USTR said the sectors subject to the proposed tariffs include industries such as aerospace, information and communication technology, robotics, and machinery. Beijing will reportedly introduce 25 percent levies on 106 American goods, including soybeans, cars, aircraft, beef, cigars and whiskey. "Now we have a Trade Deficit of $500 Billion a year, with Intellectual Property Theft of another $300 Billion".
It's a strategy that might just work.
Yesterday, the Chinese government implemented retaliatory tariffs up to 25% on imports of 128 American-made products, including pork, an important moneymaker, and seamless steel pipes.
Aircraft maker Boeing Co BA.N closed down 1 percent, weighing the most on the Dow Jones Industrial Average .DJI as documents from China's Ministry of Commerce and the USA manufacturer showed the move would affect some older Boeing narrowbody models.
USA neighbors Canada and Mexico are exempted from the tariffs, with Trump saying other countries could potentially receive similar exemptions if they can "ensure that their products no longer threaten our security".
"There is no victor in a trade war, and an initiator will harm itself as well as others".
The report concludes that the trade balance approach is "clearly misleading", and the most damaging retaliation from China is to "punish US business interests in China".
Amazon shares fall 6pct on Trump attack
The price target set for the stock is $1670.66 and this sets up an interesting set of potential movement for the stock. Earnings per share are generally pondered to be the single most essential variable in determining a share's price.
The stock market's ability to mount a rebound was due in part to investors' continued belief that neither country wants a full-out trade war despite the tit-for-tat tariff threats. Sometimes tariffs are used to raise the price of imported products so that they don't undercut domestic products.
Now he is moving toward steep tariffs to pressure Beijing into treating US technology companies more fairly.
China's tariffs could hurt sales of some of Boeing Co.'s best-selling planes, such as the 737 family of passenger jets and put the company at a disadvantage to Airbus SE.
On Wall Street, stocks sank as worry about trade tensions was compounded by heightened public scrutiny of tech companies in the United States and Europe. It all adds up to about $3 billion. Technology stocks have turned higher.
China said it was taking the action on 106 USA products in retaliation for Trump's levying tariffs on $50 billion worth of Chinese goods.
The fact that the United States intends to enter in a trade war has begun to bother people and they already perceive it to be a bad thing for the whole world.
United States orange juice, certain sorghum products, cotton, some types of wheat, as well as trucks, some sport-utility vehicles, and certain electric vehicles, will also be subject to the new tariffs, according to the Chinese Finance Ministry. Others noted the two countries have too much to lose from a trade war.
Farm equipment maker Deere lost $4.47, or 2.9 percent, to $148.57, after an early drop of 6.2 percent.