S&P 500 ends lower as investors digest Trump's auto tariffs
By Noel Randewich
(Reuters) -The S&P 500 ended lower on Thursday, as investors grappled with U.S. President Donald Trump's latest trade tariff announcement that hit shares of General Motors and Ford.
Trump unveiled on Wednesday his plan to implement a 25% tariff on imported cars and light trucks effective on April 3, while the duty on auto parts begins on May 3. Investors are also bracing for a wave of reciprocal tariffs Trump plans to unveil on Wednesday, although the president has hinted there may be room for flexibility.
In a volatile session on Wall Street, General Motors tumbled over 7% and Ford slid 3.9%. Car parts manufacturers Aptiv and BorgWarner each lost around 5%.
Tesla edged up 0.4%, with investors betting the electric vehicle maker will be hurt less by tariffs because of its largely domestic production.
Apple added 1.05%, helping limit the S&P 500's loss.
Trump's mercurial trade policies have created uncertainty on Wall Street, as investors fret over potential disruptions to supply chains, hampered investment, and the specter of inflation threatening global economic growth.
"Investors are really cautious and wary of Trump and his policies. Even more than the policies, just the constant flip-flopping," said Jed Ellerbroek, a portfolio manager at Argent Capital in St. Louis, Missouri. "That makes people really nervous to make long-term investment decisions, whether we're talking about companies or about investors."
The S&P 500 declined 0.33% to end the session at 5,693.31 points.
The Nasdaq dropped 0.53% to 17,804.03 points, while the Dow Jones Industrial Average declined 0.37% to 42,299.70 points.
Of the 11 S&P 500 sector indexes, eight declined, led lower by energy, down 0.85%, followed by a 0.84% loss in communication services.
The number of Americans filing new applications for unemployment benefits slipped last week, while the jobless rate appeared to have held steady in March.
Also on Thursday, the headline figure for fourth-quarter gross domestic product growth was revised to 2.4%, higher than the consensus estimate of 2.3% in a Reuters poll.
Shares of Dollar Tree jumped 11% as several analysts raised their price targets after the discount retailer on Wednesday said it sold its struggling Family Dollar business for about $1 billion.
Investors on Friday will focus on the February personal consumption expenditures price index — the Federal Reserve's favored inflation gauge.
Traders have trimmed their exposure to U.S. equities, with the S&P 500 down about 7% from its record high close on February 19. The Nasdaq is down almost 12% from its record high close on December 16.
The S&P 500 and Nasdaq are both on course to conclude the first quarter of 2025 in negative territory. So far in 2025, the S&P 500 has lost about 3% and the Nasdaq is down almost 8%.
Fed policymakers Susan Collins and Thomas Barkin are expected to share their economic insights later on Thursday.
Declining stocks outnumbered rising ones within the S&P 500 by a 1.3-to-one ratio.
The S&P 500 posted 15 new highs and seven new lows. The Nasdaq recorded 34 new highs and 195 new lows.
Volume on U.S. exchanges was relatively light, with 14.7 billion shares traded, compared to an average of 16.3 billion shares over the previous 20 sessions.
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