[NEW YORK] Wall Street stocks retreated for a second day on Thursday, as US President Donald Trump’s announcement of upcoming tariffs on imported vehicles and parts rocked financial markets and sparked global jitters.
The Dow Jones Industrial Average fell by 0.4 per cent to 42,299.70, while the broad-based S&P 500 Index lost 0.3 per cent to 5,693.31.
The tech-heavy Nasdaq Composite Index tumbled 0.5 per cent to 17,804.03.
Analysts said the imposition of the tariffs – with further announcements on levies on the way on April 2 – had delivered a shock to global markets.
“I think there’s a lot of confusion right now,” said Tom Cahill at Ventura Wealth Management.
Investors have been expecting more details surrounding Trump’s promised tariffs on April 2, with markets previously lifted by hopes that they would be more targeted than anticipated.
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Trump has vowed to impose reciprocal tariffs to address practices that his administration deems unfair, but the White House earlier signaled that separate sector-specific action might not come on the same day.
But Trump’s announced 25 per cent auto tariffs, to take effect next week, came unexpectedly to investors, Cahill added.
Around half of vehicles sold in the United States are imported, and the supply chain for North American automobile production involves parts crossing borders multiple times.
This means that tariffs would likely raise costs for consumers.
On Thursday, shares in major automaker Ford declined 3.9 per cent, while General Motors plunged 7.4 per cent. Stellantis shares dropped by 1.2 per cent.
While markets have tried to rally, this effort “lacks conviction,” said Cahill, as it is risky getting ahead of Trump’s April 2 announcement. AFP
