Investors braced for a rocky stock market one day after President Donald Trump announced his “Liberation Day” plan – across-the-board tariffs on the U.S.’s trading partners.
Stock futures plunged Thursday morning, with the Dow Industrial Average down -1.207 points and the Nasdaq Composite down -769 points. The stock market doesn’t open in the U.S. until 9:30 a.m.
The president predicted Wednesday would “forever be remembered as the day American industry was reborn, the day America’s destiny was reclaimed and the day that we began to make America wealthy again.”
He imposed the new levies to prevent Americans from continuing to be what he describes as “ripped off” — but business leaders believe the sweeping tariffs will be “catastrophic” for U.S. consumers.
Global markets also reacted unfavorably, with the Asian and European falling Thursday morning. The Nikkei in Japan was down 2.77 percent at close while the European Stoxx 600 index was down by 2.26 percent by Thursday afternoon.
Tump announced Wednesday in the White House Rose Garden that starting at midnight, Americans will at minimum pay what he called a 10 percent “baseline tariff” on all imports “to help rebuild our economy and to prevent cheating.”
Leaders of the some of the U.S.’s largest trading partners have said they are already preparing reciprocal tariffs.
European Commission President Ursula von der Leyen called Trump’s decision a “major blow” to the global economy, adding Thursday: “We are now preparing for further countermeasures, to protect our interests and our businesses if negotiations fail.”
Other world leaders have denounced the new levies, but vowed to work with the U.S. to avoid a trade war.
But business leaders warn these levies will have deleterious impacts for American families.
National Association of Manufacturers president and CEO Jay Timmons said in a statement on Wednesday that Trump’s tariffs will “threaten investment, jobs, supply chains, and, in turn, America’s ability to outcompete other nations and lead as the preeminent manufacturing superpower.”
“Trump is going to war with countries on this,” Andrew Brenner, head of international fixed income at National Alliance Securities, told the New York Times. “It’s ridiculous. It shows no comprehension as to what he is doing to other countries. And it is going to hurt the U.S.”
House Democratic leader Hakeem Jeffries told MeidasTouch after Trump’s announcement: “The stock market is collapsing, and what that means is the retirement savings of everyday Americans are disappearing by the hour. And this is all because of Trump’s reckless mismanagement of the economy and now, these tariffs that are being imposed are going to raise the cost of goods for everyday Americans by some estimates, by thousands of dollars per year.”