The back-and-forth barbs are a bad sign for investors who were hoping that the trade war over tariffs was starting to de-escalate.

An array of charges and countercharges over the weekend between the US and China raised the stakes of a long-awaited call between leaders of the two countries as relations hit new turbulence over tariffs and other issues.

The so-called TACO trade will be tested as markets wait to see if Trump will actually follow through with his latest threat or if he will put it on hold soon.