Kunming/Washington | Wall Street is in freefall, with more than $1.4 trillion wiped off the value of equity markets, after China announced a plan for retaliatory tariffs on $US60 billion ($83 billion) of US goods from June 1.

In a jarring contrast to last week's nonplussed trading close, the bleak reality of a worsening trade dispute smashed stocks, sent bond yields tumbling and doubled the odds of a Fed rate cut this year to 80 per cent. The Dow Jones Industrial Average closed down 617 points.