Dow futures plunge over 600 points as Trump tariffs spark trade war concerns
Stock futures took a sharp downturn to start the new trading month after President Donald Trump imposed tariffs on key U.S. trading partners, stoking fears of a full-blown trade war.
Investors are concerned that escalating trade tensions could disrupt global supply chains, reignite inflation, and slow economic growth, News.Az reports, citing CNBC News.
Futures tied to the Dow Jones Industrial Average fell 632 points, or 1.4%. S&P 500 futures dropped 1.7%, while Nasdaq-100 futures lost 1.9%. Futures on the Russell 2000, the small-cap benchmark, lost 2.2%.
The Cboe Volatility Index, Wall Street’s fear gauge, spiked above 21.
The impact from the new tariffs ricocheted around the globe in a risk-off move:
- Major European equity markets sunk with Germany’s Dax benchmark off by nearly 2%.
- Bitcoin tumbled to around the 95,000 level from above $102,000 before the weekend. Ether lost 12%.
- The ICE U.S. Dollar Index, a measure of the U.S. dollar versus several currencies, leaped 1%.
- WTI crude oil jumped 2% on concern of supply disruptions in North America from the new tariffs.
President Donald Trump on Saturday slapped a 25% tariff on goods from Mexico and Canada. He also placed a 10% levy on imports from China. Energy imports from Canada received a lower 10% tariff. Canada responded with retaliatory tariffs of its own, while Mexico said it would explore levies on U.S. imports. The Chinese government, meanwhile, said it would file a lawsuit with the World Trade Organization.
Trump also signaled over the weekend that tariffs on the European Union would be imposed next.
U.S. automakers with big North American supply chains led the decline, with General Motors shares off by 7% and Ford down by 4% in premarket trading. Auto suppliers including Aptiv and Avery Dennison lost 6% and 2%, respectively. Engine maker Cummins lost 3%.
Constellation Brands, a large importer of alcohol from Mexico, tumbled 5%. Shares of Chipotle, which imports avocados from Mexico, lost 3%. Clothing makers Nike and Lululemon were down by about 3% each.
One of the positive groups were steelmakers, with Nucor gaining 3% and Steel Dynamics up nearly 4% in premarket trading.
Similar news
