US markets as higher prices for Chinese products come into play

A few hours before Thursday's meeting, the president said tariffs were an "excellent" alternative to a trade deal with China.

"This decisive turning point by the United States has certainly been a nasty (if not totally unpredictable) surprise for the markets, which may now face increased trade tensions longer than expected," said Hannah. Anderson, Global Markets Strategist at JP Morgan Asset Management. written in a note.

The shares extended the sell-off this week on Thursday. The Dow Jones Industrial Average Index fell more than 650 points this week, while the S & P 500 Index lost about 2.5% as a result of Sunday's tariff hike threats by the president .

On Monday, the actions rejected the President's weekend tweet as a mere tactic of negotiation. But the harsher rhetoric of Robert Lighthizer, US representative of foreign trade, weighed on the main indices.

Markets fell again after the president declared that it was possible to conclude a trade deal with China this week. The Dow dropped nearly 450 points to its lowest on Thursday, reducing losses and ending the day at 138 points.

"This episode shows that trade tensions are not really resolved until an agreement is signed, sealed and delivered." In the meantime, the magnitude of the liquidation of the last days is the proof that market expectations may be wrong, especially when investors are more reliant on rumors than done, "said Anderson.

The Cboe Volatility Index, a measure of the 30-day implied volatility of the S & P 500, better known as Wall Street's "Finger Gauge," hit its highest level since Jan. 4 Thursday.