Boeing shares drop after China hits back with tariffs on US auto, aerospace industries

Key Points
  • Stocks traded lower early Wednesday after China's announcement of retaliatory tariffs on 106 U.S. products.
  • The new targets include soybeans, cars and aerospace and defense.
New China tariffs to hit US carmakers

Stocks fell Wednesday morning on rising concerns over a potential trade war between the U.S. and China.

China on Wednesday announced new tariffs on 106 U.S. products, including soybeans, cars, aerospace and defense.

As a result, automakers such as Ford and General Motors shares fell sharply near the market open, but rallied to up more than 1 percent. Telsa's stock dropped as much as 5 percent before paring its loss and rising to up 7 percent. China is a key market for the electric car maker.

A Boeing 787 Dreamliner operated by United Airlines takes off from Los Angeles International Airport.
Getty Images

Aerospace company Boeing was down 1.7 percent. The company announced a $37 billion order for its planes from China last year.

U.S. machine manufacturers that serve the agricultural and construction industries also fell. Deere was down more than 3 percent and Caterpillar fell 0.5 percent.

China's move came after the Trump administration on Tuesday named a list of Chinese imports it plans to target for tariffs.

Sectors covered by President Donald Trump's proposed tariffs include products used for robotics, information technology, communication technology and aerospace.