Market Reaction to Tariff Announcement
Stocks on Wall Street dropped significantly after President Donald Trump confirmed that tariffs on Canada and Mexico would go ahead. The Dow Jones Industrial Average fell nearly 800 points, or 1.8%. The S&P 500 lost 2.1%, and the Nasdaq Composite decreased by 3%, with Nvidia’s issues contributing to the decline.
Details of Trump’s Tariff Plans
During a press conference, Trump announced that tariffs would begin at 25% on both Canada and Mexico. He stated, “There’s no room left for Mexico or for Canada.” Trump also revealed plans for a 10% tariff on China, in addition to the previous increase. He mentioned that “reciprocal” tariffs would take effect on April 2, including duties on agricultural products, though he did not offer further specifics.
Economic Concerns Amid Tariff News
Before Trump’s announcement, economic reports signaled possible trouble for the U.S. economy. A measure of manufacturing activity showed rising costs, largely due to trade concerns. An executive from the machinery industry reported that trade-related price hikes were pushing labor costs higher.
Stock Market Sell-Off Following Tariff Announcement
The announcement led to a stock market sell-off, erasing the gains Wall Street had seen earlier this year. The Dow, which had increased by 5%, is now up only 1%. Retail sales also saw a sharp decline last month, and consumer confidence showed signs of weakening.
Impact on Major Brands
Retailers like Walmart have expressed concerns that Trump’s trade policies could hurt their business. However, some companies, such as Chipotle, plan to absorb the additional costs rather than pass them onto consumers.
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