The ASX 200 index (ASX: XJO) had a bad day, but it isn't the end of the world yet.
If you haven't already seen, the ASX 200 dropped 1.9% today in what was a painful day for many businesses. For example, the Appen Ltd (ASX: APX) share price dropped 10.6% and the Fortescue Metals Group Limited (ASX: FMG) share price went down 7.2%.
The cause of the market despair was a fall in the Chinese Yuan against the US dollar, it fell beyond the 7-per-dollar level in over a decade after US President Donald Trump announced he planned to put a 10% tariff on the US$300 billion of Chinese imports, that haven't already had tariffs put on, from the start of the next month.
End result to the ASX 200? It 'plunged' 1.9% to 6,640.30. You might think that's a big fall – it is – but it had been at that level in July and it's still higher than nearly all of 2019.
As we've seen many times over the course of this trade war, markets have often recovered to new heights despite the amount of tariffs going up and up.
There's always a reason to be fearful to invest or to be fearful about staying invested.
The market may well be headed for several days of painful days. There doesn't seem to be a solution to the trade war on the horizon. I imagine it's going to be a problem until at least the next election and perhaps longer. China is going to keep growing in economic and political power.
Foolish takeaway
The only thing we can control is the price we pay for investments, and a lot of businesses have seemed too expensive for me to invest in. Hopefully we can find more opportunities in the coming weeks and months.
