Trump's tariff assault on Canada drags Wall St lower
Trump on Thursday announced a 35% tariff on Canadian imports, set to kick in next month, up from the 25% imposed in March, and warned that the levy could climb higher if Canada retaliates.
The president also floated the possibility of a sweeping 15% or 20% tariff on other countries, up from the current 10% baseline.
Caution also prevailed as the European Union braced for a possible formal letter from Trump, with details on fresh tariffs.
At 10:04 a.m., the Dow Jones Industrial Average fell 263.99 points, or 0.58%, to 44,390.90, the S&P 500 lost26.77 points, or 0.42%, to 6,253.94, and the Nasdaq Composite lost 42.03 points, or 0.20%, to 20,588.63.
All sub-indexes of the S&P 500 traded in the red, with losses primarily led by financials and materials, both down 1.1% each.
The S&P 500 and the tech-heavy Nasdaq are on track to end the week slightly lower, and the Dow looks set to snap its three-week winning streak - the longest since January.
Wall St steadies as investors focus on trade talks after latest tariff shock
Markets have remained largely subdued this week, with the only highlight being Nvidia becoming the first company to breach the $4 trillion valuation milestone. Its shares hit a fresh record high on the day.
This week, President Trump widened his tariff offensive, targeting a number of countries, including allies Japan and South Korea, and introducing a new 50% tariff on copper.
Market reaction to the new tariff announcements was far less choppier than the turbulence following early April's 'Liberation Day' announcements, when all the major indexes posted their steepest weekly losses in nearly six years.
Investors are now gearing up for the upcoming earnings season, hoping for a clearer read on how trade turmoil has rippled through corporate America.
Wall Street's big banks are scheduled to report quarterly results next week, with J.P. Morgan kicking off the earnings season on Tuesday.
'We believe expectations are a bit low for S&P 500 earnings. Much of the second quarter was marked with tariff and trade issues and that may have caused some dislocations in earnings,' said Michael Landsberg, chief investment officer, Landsberg Bennett Private Wealth Management.
The coming week is also packed with economic data releases, including consumer and producer price inflation and retail sales readings.
Meanwhile, last week's robust jobs report has nearly dashed all hopes for a July rate cut. Investors are now betting on a September move – odds for which stand at 60.6%, according to CME FedWatch.
Denim maker Levi Strauss & Co jumped 10.2% after the company raised its annual revenue and profit forecasts and beat quarterly estimates on Thursday.
Meta Platforms fell 2%. A report said the company was unlikely to make more changes to its pay-or-consent model, potentially inviting fresh EU antitrust charges and hefty dailyfines.
Declining issues outnumbered advancers by a 3.47-to-1 ratio on the NYSE, and by a 2.34-to-1 ratio on the Nasdaq.
The S&P 500 posted six new 52-week highs and one new low, while the Nasdaq Composite recorded 27 new highs and 20 new lows.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Business Recorder
2 hours ago
- Business Recorder
Oil eases as Trump's 50-day deadline for Russia reduces supply fears
NEW YORK: Oil prices edged lower on Tuesday after U.S. President Donald Trump's 50-day deadline for Russia to end the Ukraine war and avoid sanctions eased concerns about any immediate supply disruption. Brent crude futures were down 15 cents at $69.06 a barrel by 10:54 a.m.. U.S. West Texas Intermediate crude futures were down 30 cents at $66.68. 'The focus has been on Donald Trump. There was some fear he might target Russia with sanctions immediately and now he has given another 50 days,' said UBS commodities analyst Giovanni Staunovo. 'Those fears about an imminent additional tightness in the market have dissipated. That's the main story.' Oil prices had climbed on the potential sanctions but later gave up gains as the 50-day deadline raised hopes that sanctions could be avoided. Oil steadies near three-week high on signs of tighter supply In the event the proposed sanctions are implemented, 'it would drastically change the outlook for the oil market,' analysts at ING said in a note on Tuesday. 'China, India and Turkey are the largest buyers of Russian crude oil. They would need to weigh the benefits of buying discounted Russian crude oil against the cost of their exports to the U.S.,' the ING note said. Trump announced new weapons for Ukraine on Monday and had said on Saturday that he would impose a 30% tariff on most imports from the European Union and Mexico from August 1, adding to similar warnings for other countries. Tariffs raise the risk of slower economic growth, which could reduce global fuel demand and drag oil prices lower. China's economy slowed in the second quarter, data showed on Tuesday, with markets bracing for a weaker second half as exports lose momentum, prices continue to fall and consumer confidence remains low. Tony Sycamore, an analyst at IG, said economic growth in China came in above consensus, largely because of strong fiscal support and the front-loading of production and exports to beat U.S. tariffs. 'The Chinese economic data was supportive overnight,' said Phil Flynn, senior analyst with Price Futures Group. Elsewhere, oil demand is set to remain 'very strong' through the third quarter, keeping the market balanced in the near term, the Organization of the Petroleum Exporting Countries' secretary general said, according to a Russian media report.
Business Recorder
2 hours ago
- Business Recorder
EU top diplomat says US should share ‘burden' of arming Ukraine
BRUSSELS: EU foreign affairs chief Kaja Kallas on Tuesday said the United States should 'share the burden' of arming Ukraine, after President Donald Trump said Europe could buy American weaponry for Kyiv. 'We welcome President Trump's announcement to send more weapons to Ukraine, although we would like to see US share the burden,' Kallas said after a meeting of EU foreign ministers in Brussels. 'If you promise to give the weapons, but say that it's somebody else who is going to pay for it, it is not really given by you.' Trump announced a tougher line on Moscow over its war in Ukraine on Monday as he gave the Kremlin 50 days to end the fighting or face massive new economic sanctions. With NATO chief Mark Rutte, Trump also unveiled a deal under which European members of the alliance would buy billions of dollars of arms from the United States – including Patriot anti-missile batteries – and send them to Ukraine. Trump has long railed against what he sees as the outsized role the United States has played in arming Ukraine, even though NATO says Europe is now responsible for the bulk of the weaponry going to Kyiv. European nations Germany, Denmark, Sweden and the Netherlands have already said they will or are looking to participate in the new US scheme.
Business Recorder
3 hours ago
- Business Recorder
Dollar hits 15-week high against yen as consumer prices gain
NEW YORK: The dollar reached a 15-week high against the Japanese yen on Tuesday after U.S. data that showed a rise in consumer prices in June, though the increase was not big enough to change expectations on when the Federal Reserve is likely to resume interest rate cuts. Expectations that U.S. President Donald Trump's tariff policies will increase price pressures are seen keeping the Fed on hold as policymakers wait to see their impact. Fed Chair Jerome Powell has said he anticipated prices will rise this summer. 'Tariffs are in the data, but it's not as devastating as many feared,' said Brian Jacobsen, chief economist at Annex Wealth Management in Menomonee Falls in Wisconsin. The Consumer Price Index increased 0.3% last month after edging up 0.1% in May. That was the largest gain since January. In the 12 months through June, the CPI advanced 2.7% after rising 2.4% in May. Dollar holds near 3-week high before CPI; bitcoin eases back from record peak Economists polled by Reuters had forecast a 0.3% monthly increase and a 2.6% rise on a year-over-year basis. Excluding the volatile food and energy components, the CPI rose 0.2% in June after edging up 0.1% in the prior month. In the 12 months through June, core inflation was 2.9%, inching up after holding at 2.8% for three straight months. Fed funds traders are pricing in 48 basis points of cuts by year-end, little changed from before the data, with the first rate reduction expected in September. 'A slightly softer-than-expected June core inflation reading keeps alive the chances of a September Federal Reserve interest rate cut, but the risk is that we get less benign prints for July and August,' James Knightley, chief international economist, US at ING said in a note. 'That means we will need to see clear evidence of softer jobs figures to trigger Fed action before December.' The euro was last down 0.27% on the day at $1.1631, the lowest since June 25. Against the Japanese yen, the dollar strengthened 0.66% to 148.68, the highest since April 3. Sterling weakened 0.21% to $1.3399, the lowest since June 23. The dollar weakened after Trump in April announced larger than expected tariffs, but then delayed many of the levies pending negotiations with trading partners. Trump last week announced higher tariffs would come into effect on August 1 for imports from a range of countries, including Mexico, Japan, Canada and Brazil, and the European Union, though market reaction this time was relatively muted. 'The market is ignoring the tariffs until it becomes clear whether there's going to be sort of a major escalation like there was with China in April or if this is just yet another step on the way to some sort of deal,' said Steve Englander, head of global G10 FX research and North America macro strategy at Standard Chartered Bank's NY Branch. In addition to tariffs and inflation, markets are also focused on the U.S. fiscal and debt outlook, and the pressure the Trump administration is placing on Powell as he keeps rates on hold. 'There are a lot of balls in the air. It's just that it's unclear how heavy each one of them is, and which one is going to have the biggest impact when it lands,' Englander said. Trump said on Tuesday that consumer prices were low and the Fed should bring down interest rates now. Powell has also asked the U.S. central bank's inspector general to review the costs involved in the renovation of its historic headquarters in Washington, as Trump administration officials intensify their criticism of how the Fed is being run. U.S. Treasury Secretary Scott Bessent said on Tuesday that a 'formal process' is already starting to identify a potential successor to Powell, whose term will end in May. Bitcoin fell 1.52% to $118,394. It hit a record $123,153 on Monday as investors bet on long-sought policy wins for the industry this week, which has been dubbed 'crypto week' by U.S. Republicans.
