Stocks rebound after threat of new China tariffs caused early losses

May 6 (UPI) -- Stocks bounced back Monday to erase early losses after investors initially braced for further decline due to President Donald Trump's threat of new China tariffs.

The Dow Jones Industrial Average closed down 66 points after dropping more than more than 400 points at the bell as traders worried about the continued trade war between the United States and China after Trump's tweet in which he complained that trade negotiations between the two largest economies in the world were moving too slowly.

The New York Post reported that the S&P 500 opened 36.75 points lower, losing 1.25 percent while the Nasdaq Composite fell 182.15 points, or 2.23 percent at the bell. The S&P recovered to close down 13.71 points, or 0.45 percent, while the Nasdaq closed down 40.71 points, or 0.50 percent.

After the early morning decline, CNBC reported that a Chinese delegation will follow through with its plans to travel to the United States on Wednesday to continue trade negotiations, partially easing some investors' fears and contributing to the market's rebound.

In a new tweet before markets opened Monday, Trump said that the U.S. trade deficit with China must change.

"The United States has been losing, for many years, 600 to 800 Billion Dollars a year on trade," Trump wrote. "With China we lose 500 Billion Dollars. Sorry, we're not going to be doing that anymore!"

On Sunday, Trump hailed Chinese tariffs for helping spur the United States' current economic boom.

"For 10 months, China has been paying tariffs to the USA of 25 percent on 50 billion dollars of high tech, and 10 percent on 200 billion dollars of other goods," Trump wrote. "These payments are partially responsible for our great economic results. The 10 percent will go up to 25 percent on Friday.

"325 billion dollars of additional goods sent to us by China remain untaxed but will be shortly, at a rate of 25 percent," Trump continued. "The tariffs paid to the USA have had little impact on product cost, mostly borne by China. The trade deal with China continues, but too slowly, as they attempt to renegotiate. No!"

Shanghai's benchmark index fell 5.6 percent Monday despite China's efforts to limit the anticipated selloff, Bloomberg reported. The Hang Seng in Hong Kong tumbled 3 percent and the Stoxx Europe 600 index slid 1.2 percent. Oil futures also opened lower, CNN stated. Chinese officials were expected to travel to the United States for another round of trade talks.

"It's making the outcomes more binary, with everybody focused on the Friday deadline -- there doesn't seem to be much leeway now to much go past that," Joyce Chang, chair of global research at JPMorgan Chase & Co., said on Bloomberg Television. "It's going to mean that investors will be very focused on the trade issues even beyond China."