US open: Stocks drop again as Sino-US worries weigh

US stocks were in the red again on Tuesday amid escalating trade tensions between the US and China.

At 1520 BST, the Dow Jones Industrial Average was down 1.3% at 26,093.61, while the S&P 500 and Nasdaq were down 1.4% at 2,891.52 and 8,007.32, respectively.

The mood took a hit after US Trade Representative Robert Lighthizer confirmed US President Trump's twitter threat over the weekend to raise tariffs on $200bn of Chinese goods to 25% from 10% as early as Friday. Lighthizer and US Treasury Secretary Steve Mnuchin also accused China of reneging on its commitments in trade talks.

Despite all the wrangling, talks between the US and China are still due to take place later this week in Washington.

David Cheetham, chief market analyst at XTB, said: "Alongside the U-turn in Fed policy, the most significant contributing factor to this year’s bull market run in equities appeared to be raised hopes of a de-escalation in the US-China trade tensions with positive noises coming from both sides and the US even delaying the implementation of higher levies.

"However, these hopes were dashed on Sunday when US president Trump took to Twitter to threaten additional increases on the existing tariffs in just a matter of days and stocks are now in very real danger of facing a significant headwind that would make further advances very hard going indeed. The latest move could well be a negotiating ploy from Trump, with the aim of squeezing further concessions from Beijing but the US president is playing a dangerous game that could backfire spectacularly."

In corporate news, Allegan slumped even as the pharmaceutical company lifted its full-year expectations and posted better-than-expected first-quarter earnings.

Elsewhere, Mylan was also in the red after its first-quarter revenue fell short of analysts' expectations.

Still to come, ride-sharing app Lyft is due to report its first earnings as a public company.

On the data front, figures out earlier showed that US job openings rebounded in March but the pace of hiring was fairly steady.

Job openings rose by 346,000 to a seasonally-adjusted 7.5 million, according to the Labour Department's Job Openings and Labor Turnover Survey.

The job openings rate increased to 4.7% from 4.5% in February and hiring was little changed at 5.7m.