
The Dow opened more than 240 points lower, a 1 percent drop, while the Nasdaq fell 0.9 percent and the S&P index dropped 0.8 percent.
Adams, of PNC Financial, said the tariffs would be especially painful for companies in agriculture: machinery makers in the US would pay more for imported components, and they wouldn't sell as much food in China because their products would be more expensive.
Most of the Dow finished in positive territory, with Home Depot, Microsoft and Nike all winning more than two percent. The tariffs total $50 billion - the same amount the U.S.is proposing on about 1,300 Chinese products.
Despite the short-term market turbulence, investment pros are still hopeful that a full-fledged trade war will not break out. Caterpillar and Boeing, industrial giants that rely on China, led the index's losses.
Fears of a trade war since Trump announced tariffs on steel and aluminum imports more than a month ago have kept investors on edge over concerns that such protectionist measures would hit global economic growth.
Hong Kong's Hang Seng slumped 2.2 percent with the decline accelerating in the final minutes of trading after Beijing announced specifics of its tariff hikes. The S&P 500 lost 58.37 points, or 2.19 per cent, to 2,604.47 and the Nasdaq Composite dropped 161.44 points, or 2.28 per cent, to 6,915.11. Boeing shares are down 2.7 percent and Caterpillar is down 2 percent. "Agriculture survives based on experts, and if we lose that opportunity, it's going to be a deep problem for agriculture and rural communities", Jim Byrum, of the Michigan Agri-Business Association, said.
With administration officials sounding conciliatory one day and hostile the next and the president quick to fire off yet another tweet, investors simply don't know what the US wants to achieve in its talks with China, said Katie Nixon, chief investment officer for Northern Trust Wealth Management. While annual growth in average hourly earnings rose to 2.7 per cent, it stayed below the 3 percent that economists estimate is needed to lift inflation toward the Federal Reserve's 2-per cent target.
Mr Trump's top economic adviser Larry Kudlow said in various interviews that he learned of the new tariffs on Thursday night, but also said there are ongoing talks on trade between the United States and China.
Gold, considered a safe-haven investment, is up 0.2 percent.
"That war was lost many years ago by the foolish, or incompetent, people who represented the U.S. Now we have a Trade Deficit of $500 Billion a year, with Intellectual Property Theft of another $300 Billion". The FTSE 100 in Britain was 0.5 percent lower.
The Fed is on track to raise rates three times this year, but it could speed up the increases to keep the economy from overheating.
The energy group fell 1.4 per cent as crude oil prices tumbled.
Stocks dipped further after Trump criticized the World Trade Organization on Twitter Friday morning and the losses worsened in the afternoon. Germany's DAX fell 1.2 percent while France's CAC 40 was down 0.9 percent.
USA gold futures for June delivery settled up 0.6 per cent at US$1,336.10 an ounce.
The yield on the 10-year US Treasury note, which has been steadily climbing as investors' inflation expectations rise, dipped slightly to 2.78% after the jobs report. Silver fell 14 cents to $16.25 an ounce and Copper lost 5 cents to $3.01 a pound.
CURRENCIES: The dollar slipped to 107.39 yen from 107.40 yen The euro rose to $1.2235 from $1.2241.
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