President Donald Trump announced late on Friday that the United States will impose new tariffs of 100% on all imports from China starting on November 1, in addition to the current tariff rate, which analysts say is already 40%.

Trump also said Washington would impose export controls on "any mission-critical software" from the same date, marking one of the largest trade escalations since the start of the tariff conflict between the United States and China.

The move followed Beijing's decision to tighten export restrictions on rare earth minerals, which are critical raw materials for the automotive, semiconductor and defense industries.

China controls about 70% of the global supply of rare earth metals, making it a critical bottleneck in technological supply chains.

Trump said China had taken an "extremely aggressive" stance and hinted that it might cancel a planned meeting with President Xi Jinping at the upcoming APEC summit in South Korea.

Stocks are falling, traders are preparing for further escalation

Financial markets reacted immediately. U.S. stocks reversed early gains and accelerated their decline by the close of trading on Friday, with the Dow Jones Industrial Average ending the day down 1.9% and the S&P 500 losing 2.71%, its sharpest one-day drop since April 10.

The NASDAQ Composite, which had reached a record intraday high earlier in the session, ended trading down 3.56% as technology stocks bore the brunt of the sell-off.

Analysts point to concerns that restrictions on rare earths could disrupt the production plans of large American technology companies. Wall Street's fear indicator, the CBOE Volatility Index, jumped above 22.

"After a relatively calm few months and improved relations between the U.S. and China, this escalation of tensions has created a white—knuckle moment for markets, with technology stocks under severe pressure today," Wedbush analyst Dan Ives said.

Nevertheless, Ives maintains a constructive view of the sector despite the collapse, noting that "the barking is likely to be worse than the bite this time as more sober heads prevail."

He said he continues to view such downturns as buying opportunities in the semiconductor, software, and large technology company sectors.

"With a sell—off like today, we recommend that investors buy tech winners rather than run to the elevators, despite this war of words between Trump and Xi," Ives concluded.

Bitcoin continues to fall on Saturday

Risk avoidance has spread to digital assets. Bitcoin, which had already dropped sharply at the end of Friday's trading, was down 2.35%, trading at $110,745 by 11:18 a.m. Moscow time on Saturday. Ethereum is down 0.9% for the day after falling 12.2% on Friday.

The cryptocurrency has dropped by more than 10% in the last 24 hours, while major tokens, including XRP and Solana, have declined by 15-30%.

The digital asset sector has been caught up in a broader risk flight following Trump's comments, with concerns that a protracted trade conflict could tighten global liquidity conditions and reduce speculative investment flows.