Donald Trump confirms Mexico and Canada tariffs - sending financial markets reeling
Donald Trump has confirmed 25% tariffs on goods from Mexico and Canada, taking effect at 5am UK time on Tuesday.
The US president confirmed the tariffs in a speech at the White House - and his announcement sent US stocks down sharply.
The tariffs will be felt heavily by US companies which have factories in Canada and Mexico, such as carmakers.
Mr Trump said: "They're going to have a tariff. So what they have to do is build their car plants, frankly, and other things in the United States, in which case they have no tariffs."
There's "no room left" for a deal that would see the tariffs shelved if fentanyl flowing into the US is curbed by its neighbours, he added.
As of 12:01am Eastern Standard Time (5.01am GMT), Mexico and Canada face tariffs of 25%, with 10% for Canadian energy, the Trump administration confirmed.
2:45
Mr Trump's speech stoked fears of a trade war in North America and sent financial markets reeling.
Markets the Dow Jones Industrial Average, and the Nasdaq Composite fell by 1.4% and 1.76% respectively.
The share prices for automobile companies including General Motors, which has significant truck production in Mexico, Automaker and Ford also fell.
Consumers in the US could see price hikes within days, an expert has said.
Gustavo Flores-Macias, a public policy professor at Cornell University, New York, said "the automobile sector, in particular, is likely to see considerable negative consequences".
This is due to supply chains that "crisscross the three countries in the manufacturing process" and " because of the expected increase in the price of vehicles, which can dampen demand," he added.
The Trump administration is gearing up to bring in other tariffs in the coming weeks.
On 2 April, reciprocal tariffs will take on effects on all countries that impose duties on US products.
And the US president is planning to double tariffs on Chinese imports, raising them from 10% to 20%.
He is also considering 25% tariffs on goods from the EU "very soon" after claiming the bloc was created to "screw the United States".
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Rhyl Journal
37 minutes ago
- Rhyl Journal
US Supreme Court asked to pause order reinstating Education Department staff
The Justice Department's emergency appeal to the high court on Friday said US District Judge Myong Joun in Boston exceeded his authority last month when he issued a preliminary injunction reversing the lay-offs of nearly 1,400 people and putting the broader plan on hold. Mr Joun's order has blocked one of Mr Trump's biggest campaign promises and effectively stalled the effort to wind down the department. A federal appeals court refused to put the order on hold while the administration appealed. The judge wrote that the lay-offs 'will likely cripple the department'. But Solicitor General D. John Sauer wrote on Friday that Mr Joun was substituting his policy preferences for those of the Trump administration. The lay-offs help put in place the 'policy of streamlining the department and eliminating discretionary functions that, in the administration's view, are better left to the states', Mr Sauer wrote. He also pointed out that the Supreme Court in April voted 5-4 to block Mr Joun's earlier order seeking to keep in place Education Department teacher-training grants. The current case involves two consolidated lawsuits that said Mr Trump's plan amounted to an illegal closure of the Education Department. One suit was filed by the Somerville and Easthampton school districts in Massachusetts along with the American Federation of Teachers and other education groups. The other suit was filed by a coalition of 21 Democratic attorneys general. The suits argued that the lay-offs left the department unable to carry out responsibilities required by Congress, including duties to support special education, distribute financial aid and enforce civil rights laws. Mr Trump has made it a priority to shut down the Education Department, though he has acknowledged that only Congress has the authority to do that. In the meantime, Mr Trump issued a March order directing Education Secretary Linda McMahon to wind it down 'to the maximum extent appropriate and permitted by law'. Mr Trump later said the department's functions will be parcelled to other agencies, suggesting federal student loans should be managed by the Small Business Administration and programmes involving students with disabilities would be absorbed by the Department of Health and Human Services. Those changes have not yet happened. The president argues that the Education Department has been overtaken by liberals and has failed to spur improvements to the nation's lagging academic scores. He has promised to 'return education to the states'. Opponents note that K-12 education is already mostly overseen by states and cities. Democrats have blasted the Trump administration's Education Department budget, which seeks a 15% budget cut including a 4.5 billion dollar cut in K-12 funding as part of the agency's downsizing.
Reuters
38 minutes ago
- Reuters
Trump-Musk induced Tesla slide points to market risks from massive stocks
NEW YORK, June 6 (Reuters) - The rift between President Donald Trump and Tesla chief Elon Musk has captivated the world as a political drama, but it has also become a Wall Street spectacle, highlighting the risk to equity markets from the world's biggest stocks. Tesla (TSLA.O), opens new tab shares slid 14% on Thursday as Musk and Trump feuded largely on social media, including the president threatening to cut off government contracts to Musk's companies. Although the stock modestly rebounded on Friday, Thursday's decline dragged down some of the most closely followed equity indexes, which are more heavily influenced by companies with the largest market values. Tesla's fall accounted for about half of Thursday's declines for both the S&P 500 (.SPX), opens new tab and the Nasdaq 100 (.NDX), opens new tab, which fell 0.5% and 0.8% respectively, on the day. The S&P 500 is generally considered the benchmark for the U.S. stock market while the tech-heavy Nasdaq 100 (.NDX), opens new tab is the basis for the Invesco QQQ Trust (QQQ.O), opens new tab, one of the most popular exchange-traded funds. "It's a widely held stock," said Robert Pavlik, senior portfolio manager at Dakota Wealth. "When this big-name company that represents a sizable portion of the index sells off, it has an overall effect on the index, but it also has a psychological effect on investors." Tesla's decline points to the risk that many investors have long warned about, of indexes being heavily influenced by a handful of megacap stocks. Tesla is the smallest by market value of a group of massive tech and growth companies known as the "Magnificent Seven," which overall drove equity index gains in 2023 and 2024. The group has had a rockier 2025 so far, but more recently has been rebounding. The Magnificent Seven, which include Apple (AAPL.O), opens new tab, Microsoft (MSFT.O), opens new tab and Nvidia (NVDA.O), opens new tab, had a combined weight of nearly one-third in the S&P 500 overall as of Thursday's close. "If you're an investor and you own the S&P or the Nasdaq 100 ... you just need to be aware that you own a lot of exposure to a very small cohort of names," said Todd Sohn, ETF and technical strategist at Strategas. Tesla's decline on Thursday knocked about $150 billion off its market value, while its weights in the S&P 500 and Nasdaq 100 stood at 1.6% and 2.6%, respectively. Tesla shares rebounded somewhat on Friday, up about 5% in mid-day trade, putting its market value around $970 billion. Microsoft and Nvidia, whose market values exceed $3 trillion, held weights of 6.9% and 6.8% in the S&P 500 as of Thursday. Tesla shares are down some 37% since mid-December, a period that has seen the S&P 500 fall about 1%, meaning its influence in the index has also declined over that time. The shares hold a broad influence among ETFs. Tesla has a varying presence in about 10% of the total universe of about 4,200 ETFs, according to Sohn. Those include the Consumer Discretionary Select Sector SPDR Fund (XLY.P), opens new tab, which sank 2.5% on Thursday, and the Roundhill Magnificent Seven ETF (MAGS.Z), opens new tab, which dropped 2.6%. "It's very important to know holistically what is in all your ETFs, because a lot of them are overlapping," Sohn said.
North Wales Chronicle
40 minutes ago
- North Wales Chronicle
US Supreme Court asked to pause order reinstating Education Department staff
The Justice Department's emergency appeal to the high court on Friday said US District Judge Myong Joun in Boston exceeded his authority last month when he issued a preliminary injunction reversing the lay-offs of nearly 1,400 people and putting the broader plan on hold. Mr Joun's order has blocked one of Mr Trump's biggest campaign promises and effectively stalled the effort to wind down the department. A federal appeals court refused to put the order on hold while the administration appealed. The judge wrote that the lay-offs 'will likely cripple the department'. But Solicitor General D. John Sauer wrote on Friday that Mr Joun was substituting his policy preferences for those of the Trump administration. The lay-offs help put in place the 'policy of streamlining the department and eliminating discretionary functions that, in the administration's view, are better left to the states', Mr Sauer wrote. He also pointed out that the Supreme Court in April voted 5-4 to block Mr Joun's earlier order seeking to keep in place Education Department teacher-training grants. The current case involves two consolidated lawsuits that said Mr Trump's plan amounted to an illegal closure of the Education Department. One suit was filed by the Somerville and Easthampton school districts in Massachusetts along with the American Federation of Teachers and other education groups. The other suit was filed by a coalition of 21 Democratic attorneys general. The suits argued that the lay-offs left the department unable to carry out responsibilities required by Congress, including duties to support special education, distribute financial aid and enforce civil rights laws. Mr Trump has made it a priority to shut down the Education Department, though he has acknowledged that only Congress has the authority to do that. In the meantime, Mr Trump issued a March order directing Education Secretary Linda McMahon to wind it down 'to the maximum extent appropriate and permitted by law'. Mr Trump later said the department's functions will be parcelled to other agencies, suggesting federal student loans should be managed by the Small Business Administration and programmes involving students with disabilities would be absorbed by the Department of Health and Human Services. Those changes have not yet happened. The president argues that the Education Department has been overtaken by liberals and has failed to spur improvements to the nation's lagging academic scores. He has promised to 'return education to the states'. Opponents note that K-12 education is already mostly overseen by states and cities. Democrats have blasted the Trump administration's Education Department budget, which seeks a 15% budget cut including a 4.5 billion dollar cut in K-12 funding as part of the agency's downsizing.
