The possibility of a revived trade war between Beijing and Washington is raising concerns that this year’s strong rally in Chinese stocks could be undermined, and the yuan might face further pressure.

Global equities took a hit during US trading hours on Friday after President Donald Trump warned of a massive increase in tariffs on Chinese goods. He later announced plans to impose an additional 100% tariff on Chinese products starting November 1, as well as placing export controls on critical software. Trump’s comments came shortly after Beijing unveiled new curbs on rare earth exports earlier in the week.

While Chinese markets will have their first opportunity to respond on Monday, any potential follow-up to the US selloffmay be moderated by signals from the White House over the weekend that the administration is open to a deal. Additionally, Trump emphasized that the US wants to help, not harm China.

In early Monday trading, currencies like the Australian dollar edged higher, and the offshore yuan gained 0.1% against the dollar, helping to pare some of Friday’s losses.