The Dow erases its 2018 gains as Trump moves closer to an all-out trade war with China

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Global markets shuddered Tuesday after President Donald Trump threatened tariffs on billions of dollars worth of goods from China, putting the world's largest economies on the brink of a trade war. The Dow Jones industrial average turned negative for the year amid its longest losing streak since March 2017. The dollar hit an 11-month high, and Treasury yields slid.

Here is the scoreboard:

Dow Jones industrial average: 24,699.04 −288.43 (-1.15%)

S&P 500: 2,760.29 -13.46 (-0.49%)

1. Trade tensions between the US and China are soaring. After the Trump administration said it's ready to hit Beijing with tariffs on $200 billion worth of goods, the Chinese Commerce Ministry warned it would retaliate. Trump said that could result in another round of tariffs, which would all together threaten $450 billion worth of Chinese goods.
2. Russia is also pushing back on US tariffs. Economy Minister Maxim Oreshkin said Moscow will roll out import duties on US road-building machinery, in response to the Trump administration's steel and aluminum worldwide import tariffs.
3. Oil prices slid ahead of an OPEC meeting in Vienna on Friday. Oil ministers, led by Saudi Arabia and Russia, are expected to ease supply cuts amid output disruptions from several member countries including Venezuela and Iran. Trade spats also weighed on US crude, which could be included in future Chinese import tariffs.
4. In a reversal, the European Central Bank said it could continue its large-scale stimulus program next year. ECB President Mario Draghi said at a conference in Portugal that it may postpone an end to its bond-buying program, a move announced by the central bank just last week.
5. US housing starts rose last month to a peak not seen since July 2007. New construction increased 5% to a seasonally-adjusted annual rate of 1.350 million units, the Commerce Department said. But building permits fell 4.6% in May, signaling more modest activity.

And a look at the upcoming economic calendar:

• Quarterly trade data, monthly existing home sales, and weekly oil numbers are due out in the US.
• Central bank leaders from the US, Australia, and Japan speak at an ECB forum in Portugal.