By David Hodari and Allison Prang 
   -- Fresh tariff threats batter global stocks 
 
   -- Industrials, materials sectors worst in S&P 
 
   -- Safety sectors close higher 

Global stocks dropped Tuesday as trade tensions between the U.S. and China intensified, sparking selling from Shanghai to New York.

The declines came after President Donald Trump raised the stakes in Washington's trade conflict with China, asking his administration on Monday to draw up a fresh list of Chinese goods worth $200 billion on which to impose tariffs.

That move marked the latest in a series of back-and-forth measures between the countries that left investors around the globe worried the conflict would escalate into an all-out trade war.

The Dow Jones Industrial Average tumbled 287.26 points, or 1.1%, to 24700.21, notching its longest streak of consecutive declines since March 2017. The S&P 500 fell 11.16 points, or 0.4%, to 2762.59 and the Nasdaq Composite lost 21.44 points, or 0.3%, to 7725.59.

Shares of industrial and materials companies in the S&P 500, which analysts fear could take a heavy hit under a trade war, fell 2.1% and 1.8% respectively. Utilities, real estate and consumer staples -- groups that investors often buy in times of market volatility -- all climbed, along with shares of telecom and health-care firms.

Kate Warne, investment strategist for Edward Jones, cautioned investors against changing their holdings substantially, given that the tariff threats might not actually take place.

"It's hard to tell whether these announcements are all negotiating positions and we'll see some set of discussions to basically lower the temperature," Ms. Warne said.

The declines in the U.S. stocks came after Asian investors dumped Chinese stocks, sending the Shanghai Composite Index down to its lowest level in almost two years, while the Shenzhen A Share index shed 5.8%. Investors also unloaded stocks elsewhere, with the Stoxx Europe 600 closing down 0.7%.

Trade concerns were among the risks highlighted by European Central Bank President Mario Draghi on Tuesday, when he said the bank could extend its bond-buying program again and delay any interest-rate increases amid mounting economic risks. The comments, days after the ECB laid out plans to phase out its bond purchases, underline the bank's caution in winding down a major stimulus program just as the region's economy appears to be slowing.

While the impact of the trade dispute for U.S. consumers has so far been muted, firms across the world would feel the effects if Washington and Beijing implement their proposed levies, according to Paul Donovan, chief economist at UBS Global Wealth Management.

"Non-Chinese companies, including U.S. companies, are just as likely to be affected by taxes on Chinese goods, given the complexity of modern supply chains," Mr. Donovan said in a note.

Government bonds strengthened, with the yield on the benchmark 10-year U.S. Treasury note falling to 2.893%, compared with 2.926% Monday. Yields fall as bond prices rise.

With strong growth and an interest-rate increase last week from the Federal Reserve, the WSJ Dollar Index, which measures the U.S. currency against a basket of 16 others, was last up 0.2%, extending its five-day climb to 1.1% .

If U.S. tariffs do begin to squeeze the Chinese economy, "the fear would be that China could be tempted to devalue its currency as a support mechanism for its economy," said Lee Hardman, currency analyst at MUFG.

Hong Kong-listed ZTE Group plummeted 25% after the U.S. Senate voted to reinstate a ban on selling U.S. parts to the Chinese telecom company. The move marked the rejection of a deal between Mr. Trump and Beijing to save the firm.

Saumya Vaishampayan and William Mauldin contributed to this article

Write to David Hodari at David.Hodari@dowjones.com and Allison Prang at allison.prang@wsj.com

(END) Dow Jones Newswires

June 19, 2018 17:37 ET (21:37 GMT)

Copyright (c) 2018 Dow Jones & Company, Inc.