Tariff jitters hit Wall St futures; Tesla drops after Musk's political move
The White House is close to finalizing several trade pacts in coming days and will notify other countries of higher tariff rates by July 9, President Donald Trump said on Sunday, with the higher rates set to take effect on August 1.
Trump also threatened an extra 10% tariff on countries aligning themselves with the "Anti-American policies" of the BRICS group of Brazil, Russia, India, China and South Africa.
In April, Trump unveiled a base tariff rate of 10% on most countries and additional duties ranging up to 50%, subsequently pushing the Nasdaq (.IXIC), opens new tab into a bear market.
Although he later delayed the effective date for all but 10% until July 9. The new date offers countries a three-week reprieve.
The market's reaction was cautious, as investors weighed the lack of fresh details and braced for light summer trading in a week light on economic data — except for Thursday's initial jobless claims.
At 7:05 a.m. ET, Dow E-minis were down 22 points, or 0.05%, S&P 500 E-minis were down 18.25 points, or 0.29%, and Nasdaq 100 E-minis were down 100 points, or 0.43%.
Monday's pullback also comes after the S&P 500 (.SPX), opens new tab and the Nasdaq (.IXIC), opens new tab closed at record highs on Thursday following a surprisingly strong jobs report that pointed to resilience in the labor market.
The Dow (.DJI), opens new tab closed the holiday-shortened week about 0.5% away from its record high.
Among megacap stocks, Tesla (TSLA.O), opens new tab dropped 6.7% in premarket trading after Musk announced the formation of a U.S. political party, marking a new escalation in his feud with Trump.
"Although Tesla's AI future and the launch of its Robotaxi are seen as positive developments for Tesla, in the short term, Musk's political ambitions could be a major overhang for this stock," said Kathleen Brooks, research director at XTB.
Nvidia (NVDA.O), opens new tab was on track to become the world's most valuable company in history, with the chipmaker's market capitalization nearing $4 trillion. Its shares were down 0.7% on the day.
Shares of WNS (WNS.N), opens new tab jumped 14.3% after the French IT services firm Capgemini (CAPP.PA), opens new tab agreed to buy the outsourcing firm for $3.3 billion in cash.
Meanwhile, Trump's chaotic tariff policies and what that might do to economic growth and inflation have kept the Federal Reserve from cutting interest rates, and minutes of its June meeting, scheduled for release on Wednesday should offer more clues on the interest rate outlook.
Traders have now priced out a July rate cut, with September odds at 66%, according to CME Group's FedWatch tool.
Attention is on the massive tax-cut and spending bill approved by Republicans in the House of Representatives after markets closed on Thursday. The bill is to add more than $3 trillion to the country's deficit over the next decade.
While the stimulus could juice economic growth, it also threatens to stoke inflation, making the Fed's next move harder to predict.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
NBC News
11 minutes ago
- NBC News
White House extends deadline for tougher tariffs
President Trump is slated to sign an executive order to delay Wednesday's deadline until August 1. The tariff rates were initially set in April. Meanwhile, Trump is expected to meet with Israeli Prime Minister Benjamin Netanyahu as there's a renewed push for a ceasefire in Gaza. NBC News' Gabe Gutierrez reports from the White 8, 2025
Reuters
13 minutes ago
- Reuters
Brazil's XP sues short seller Grizzly Research in New York, alleges defamation
NEW YORK, July 7 (Reuters) - The Brazilian fintech company XP (XP.O), opens new tab filed a U.S. lawsuit on Monday accusing the short seller Grizzly Research of defamation over a March 12 report, opens new tab accusing XP of running a "Madoff-like Ponzi scheme." In a complaint filed in federal court in Manhattan, XP said it suffered more than $100 million in harm to its business and reputation from the report, with many longtime clients, investors and business partners withdrawing their funds. It accused Grizzly and its owner Siegfried Eggert of "brazenly, maliciously, and recklessly" publishing the report, with a goal of driving down XP's stock price so they could profit on short positions. Grizzly could not be immediately reached by phone or email after business hours, and its website was not accepting messages seeking comment on the lawsuit. Lawyers for XP did not immediately respond to requests for alternative contact information. XP's press office in Brazil declined to comment. Short sellers sell borrowed shares that they hope to repurchase later at lower prices, to replenish lenders, and pocket the difference in price. Other short sellers have been sued in the United States over their alleged defamatory reports. In its report, Grizzly said XP's alleged Ponzi scheme involved derivatives sales to retail clients, which were then funneled through special funds and misrepresented as proprietary trading profit. Grizzly said the alleged scheme was "likely to involve nefarious activities," and XP would be unprofitable without it. XP called Grizzly's claims of impropriety "demonstrably false" because its Gladius and Coliseu funds were proprietary and had no outside investors, and the challenged transactions complied with applicable Brazilian law. Shares of XP fell 5.5% to $14.14 on March 12 in New York. They closed down 32 cents at $19.48 on Monday. The lawsuit seeks unspecified compensatory and punitive damages. Madoff refers to the late swindler Bernard Madoff. The case is XP inc et al v Grizzly Research LLC et al, U.S. District Court, Southern District of New York, No. 25-05564.
The Guardian
13 minutes ago
- The Guardian
Amazon asks corporate workers to ‘volunteer' help with grocery deliveries as Prime Day frenzy approaches
Corporate employees of Amazon were asked on Monday to volunteer their time to the company's warehouses to assist with grocery delivery as it heads into its annual discount spree known as Prime Day. In a Slack message reviewed by the Guardian that went to thousands of white-collar workers in the New York City area from engineers to marketers, an Amazon area manager called for corporate 'volunteers to help us out with Prime Day to deliver to customers on our biggest days yet'. It is not clear how many took up the offer. The ask came the day before Prime Day kicks off. The manager said volunteers are 'needed' to work Tuesday through Friday this week, in two-hour shifts between 10am and 6pm in the Red Hook neighborhood of Brooklyn, where the company operates a warehouse as part of its grocery delivery service, Amazon Fresh. Corporate employees seconded to the warehouse would be tasked with picking items, preparing carts and bags of groceries for delivery, packing boxes on receiving carts, and working to 'boost morale with distribution of snacks', though they would be allowed to step into a conference room to take meetings and calls, according to the message. The manager noted such an effort would help 'connect' warehouse and corporate teams. Amazon routinely hires thousands of extra warehouse workers in advance of its annual Prime Day sale, which sees the massive online retailer discount thousands of goods, creating a surge in orders and demand for delivery. Amazon Fresh, available to Prime subscribers but separate from Amazon subsidiary Whole Foods, is also offering discounts this week during Prime Day, such as a free 90-day trial of the delivery services and $30 off of deliveries for current members, while maintaining its same-day or next-day delivery service. New York is one of Amazon's busiest areas in the US. An Amazon spokesperson, Griffin Buch, said this is not the first time 'grocery corporate' employees have been 'invited to volunteer' with fulfillment. 'This support is entirely optional, and it allows corporate employees to get closer to customers while enabling our store teams to focus on the work that's most impactful,' Buch said. Amazon Fresh has faced turbulence in recent years. Amid cost-cutting efforts in 2023 and a struggle to turn a profit on grocery delivery, CEO Andy Jassy closed several physical Amazon Fresh locations and laid off hundreds of employees in the segment. Amazon has laid off more than 27,000 employees overall since cost-cutting efforts began in 2022. A week ago, Jassy spoke on CNBC of a future at Amazon where drones and even robots were used to fulfill and deliver goods to people. Sign up to TechScape A weekly dive in to how technology is shaping our lives after newsletter promotion 'Over time, as we expand the use of robotics in our fulfillment centers, we will have robots doing fulfillment and transportation for us,' he said.
