US Stock Market Tumbles After Trump Confirms Tariffs on Canada and Mexico

by TheGlobe360
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US Stock Market Today

US markets fell on Monday after President Donald Trump declared that a 25% tax on imports from Canada and Mexico would go into effect on Tuesday, dashed hopes for a last-minute compromise and reignited trade war fears. The SP 500 plummeted 1.8%, the Dow Jones Industrial Average slid 649 points (1.5%), and the Nasdaq composite fell 2.6% as investors reacted to the tariff increase.

The unexpected news erased much of the stock market’s gains since Trump’s win, reducing the SP 500’s post-win Day increase to just over 1% from a top of more than 6%. Wall Street expected Trump to use the prospect of tariffs as a negotiating weapon in future negotiations rather than imposing them. However, the president’s decision to proceed alarmed investors who were already concerned about economic instability. “Markets were expecting another 11th-hour compromise 0 to further defer tariffs, but they will not get it this time,” said Jamie Cox, managing partner at Harris Financial Group.

“The next step is to endure them. Markets must price that truth, and the figures are painted red.” Speaking at the White House on Monday, Trump stated unequivocally: “Tomorrow, tariffs of 25% on Canada and Mexico will begin.” He continued, “There is no room for Mexico or Canada.”

In February, the president approved a one-month deferral after both countries agreed to make concessions. However, citing persistent concerns about illegal drug trafficking and migration, Trump opted to reinstate the levies.
Trump also signed an order raising a 10% duty on Chinese goods to 20%, citing Beijing’s inaction in the fight against the illegal fentanyl trade as the reason.

A study released Monday by the Institute for Supply Management (ISM) revealed a slowdown in US manufacturing activity, underscoring the wider economic effects of Trump’s tariffs. As companies struggled with the impact of the trade policy change, demand decreased, production leveled off, and job losses persisted.

“Demand eased, production stabilized, and destaffing continued as panelists’ companies experience the first operational shock of the new administration’s tariff policy,” said Timothy Fiore, chair of ISM’s manufacturing survey committee.

Retail equities and technology were particularly heavily impacted. After its CEO resigned, Nvidia sank 8.8%, Tesla lost 2.8%, and Kroger fell 3%. Even equities tied to cryptocurrencies fell, with Coinbase plunging 4.6% and MicroStrategy falling 1.8%, despite Trump’s announcement over the weekend of a strategic crypto reserve.

Trump criticized Ukrainian President Volodymyr Zelenskyy for his response to US help when he was talking about tariffs. Trump remarked, “I just think he should be more grateful because this country has stood by them through thick and thin.” “Europe should have given more than us, but we have given them a lot more.”

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