Wall Street falls as tariff uncertainty weighs
Treasury Secretary Scott Bessent said the US will make several trade announcements in the next 48 hours, ahead of a deadline on Wednesday to finalise trade pacts.
President Donald Trump said on Sunday that the country was closer to inking several trade pacts and would notify other countries of higher tariff rates by July 9.
He added that those duties are set to take effect on August 1.
In April, Trump unveiled a base tariff rate of 10 per cent on most countries and additional duties ranging up to 50 per cent, subsequently pushing the Nasdaq into a bear market.
Although he later delayed the effective date for all but 10 per cent until July 9.
The new date offers countries a three-week window for further negotiations.
Trump also threatened an extra 10 per cent tariff on countries aligning themselves with the "Anti-American policies" of the BRICS group of Brazil, Russia, India, China and South Africa.
In early trading on Monday, the Dow Jones Industrial Average fell 207.65 points, or 0.46 per cent, to 44,620.88, the S&P 500 lost 27.38 points, or 0.44 per cent, to 6,251.97 and the Nasdaq Composite lost 115.56 points, or 0.56 per cent, to 20,485.13.
Nine of the eleven major S&P sectors were trading in the red, with consumer discretionary falling the most by 1.0 per cent.
Electric vehicle maker Tesla dropped 6.8 per cent, on track for its worst day in over a month, after Musk announced the formation of a political party named the American Party, marking a new escalation in his feud with Trump.
"Tesla investors are starting to vote their displeasure with him getting back into politics. The potential for him to start his own American party is just the exact opposite of what Tesla investors want," said Art Hogan, chief market strategist at B Riley Wealth.
Shares of WNS jumped 14.2 per cent after the French IT services firm Capgemini agreed to buy the outsourcing firm for $US3.3 billion ($A5.1 billion) in cash.
Monday's pullback also comes after the S&P 500 and the Nasdaq closed at record highs on Thursday following a surprisingly strong jobs report that pointed to resilience in the labour market.
The Dow was about 1.0 per cent away from an all-time high.
Solid jobs data also backed the Federal Reserve's cautious stance on future interest rate cuts.
Traders have fully priced out a July rate cut, with September odds at 64.4 per cent, according to CME Group's FedWatch tool.
Trump's inflation-causing tariff policies have further complicated the Fed's path to lower rates.
As a result, minutes of its June meeting, scheduled for release on Wednesday, should offer more clues on the monetary policy outlook.
Attention is also on a sweeping tax-cut and spending bill, passed by House Republicans after markets closed on Thursday, that is set to swell the national deficit by over $US3 ($A4.6) trillion in the next decade.
Declining issues outnumbered advancers by a 2.1-to-1 ratio on the NYSE, and by a 1.86-to-1 ratio on the Nasdaq.
The S&P 500 posted 21 new 52-week highs and three new lows, while the Nasdaq Composite recorded 69 new highs and 32 new lows.
Wall Street's major indexes have slipped as heightened tariff tensions dampened risk sentiment, while Tesla shares slid after boss Elon Musk announced plans to launch a political party.
Treasury Secretary Scott Bessent said the US will make several trade announcements in the next 48 hours, ahead of a deadline on Wednesday to finalise trade pacts.
President Donald Trump said on Sunday that the country was closer to inking several trade pacts and would notify other countries of higher tariff rates by July 9.
He added that those duties are set to take effect on August 1.
In April, Trump unveiled a base tariff rate of 10 per cent on most countries and additional duties ranging up to 50 per cent, subsequently pushing the Nasdaq into a bear market.
Although he later delayed the effective date for all but 10 per cent until July 9.
The new date offers countries a three-week window for further negotiations.
Trump also threatened an extra 10 per cent tariff on countries aligning themselves with the "Anti-American policies" of the BRICS group of Brazil, Russia, India, China and South Africa.
In early trading on Monday, the Dow Jones Industrial Average fell 207.65 points, or 0.46 per cent, to 44,620.88, the S&P 500 lost 27.38 points, or 0.44 per cent, to 6,251.97 and the Nasdaq Composite lost 115.56 points, or 0.56 per cent, to 20,485.13.
Nine of the eleven major S&P sectors were trading in the red, with consumer discretionary falling the most by 1.0 per cent.
Electric vehicle maker Tesla dropped 6.8 per cent, on track for its worst day in over a month, after Musk announced the formation of a political party named the American Party, marking a new escalation in his feud with Trump.
"Tesla investors are starting to vote their displeasure with him getting back into politics. The potential for him to start his own American party is just the exact opposite of what Tesla investors want," said Art Hogan, chief market strategist at B Riley Wealth.
Shares of WNS jumped 14.2 per cent after the French IT services firm Capgemini agreed to buy the outsourcing firm for $US3.3 billion ($A5.1 billion) in cash.
Monday's pullback also comes after the S&P 500 and the Nasdaq closed at record highs on Thursday following a surprisingly strong jobs report that pointed to resilience in the labour market.
The Dow was about 1.0 per cent away from an all-time high.
Solid jobs data also backed the Federal Reserve's cautious stance on future interest rate cuts.
Traders have fully priced out a July rate cut, with September odds at 64.4 per cent, according to CME Group's FedWatch tool.
Trump's inflation-causing tariff policies have further complicated the Fed's path to lower rates.
As a result, minutes of its June meeting, scheduled for release on Wednesday, should offer more clues on the monetary policy outlook.
Attention is also on a sweeping tax-cut and spending bill, passed by House Republicans after markets closed on Thursday, that is set to swell the national deficit by over $US3 ($A4.6) trillion in the next decade.
Declining issues outnumbered advancers by a 2.1-to-1 ratio on the NYSE, and by a 1.86-to-1 ratio on the Nasdaq.
The S&P 500 posted 21 new 52-week highs and three new lows, while the Nasdaq Composite recorded 69 new highs and 32 new lows.
Wall Street's major indexes have slipped as heightened tariff tensions dampened risk sentiment, while Tesla shares slid after boss Elon Musk announced plans to launch a political party.
Treasury Secretary Scott Bessent said the US will make several trade announcements in the next 48 hours, ahead of a deadline on Wednesday to finalise trade pacts.
President Donald Trump said on Sunday that the country was closer to inking several trade pacts and would notify other countries of higher tariff rates by July 9.
He added that those duties are set to take effect on August 1.
In April, Trump unveiled a base tariff rate of 10 per cent on most countries and additional duties ranging up to 50 per cent, subsequently pushing the Nasdaq into a bear market.
Although he later delayed the effective date for all but 10 per cent until July 9.
The new date offers countries a three-week window for further negotiations.
Trump also threatened an extra 10 per cent tariff on countries aligning themselves with the "Anti-American policies" of the BRICS group of Brazil, Russia, India, China and South Africa.
In early trading on Monday, the Dow Jones Industrial Average fell 207.65 points, or 0.46 per cent, to 44,620.88, the S&P 500 lost 27.38 points, or 0.44 per cent, to 6,251.97 and the Nasdaq Composite lost 115.56 points, or 0.56 per cent, to 20,485.13.
Nine of the eleven major S&P sectors were trading in the red, with consumer discretionary falling the most by 1.0 per cent.
Electric vehicle maker Tesla dropped 6.8 per cent, on track for its worst day in over a month, after Musk announced the formation of a political party named the American Party, marking a new escalation in his feud with Trump.
"Tesla investors are starting to vote their displeasure with him getting back into politics. The potential for him to start his own American party is just the exact opposite of what Tesla investors want," said Art Hogan, chief market strategist at B Riley Wealth.
Shares of WNS jumped 14.2 per cent after the French IT services firm Capgemini agreed to buy the outsourcing firm for $US3.3 billion ($A5.1 billion) in cash.
Monday's pullback also comes after the S&P 500 and the Nasdaq closed at record highs on Thursday following a surprisingly strong jobs report that pointed to resilience in the labour market.
The Dow was about 1.0 per cent away from an all-time high.
Solid jobs data also backed the Federal Reserve's cautious stance on future interest rate cuts.
Traders have fully priced out a July rate cut, with September odds at 64.4 per cent, according to CME Group's FedWatch tool.
Trump's inflation-causing tariff policies have further complicated the Fed's path to lower rates.
As a result, minutes of its June meeting, scheduled for release on Wednesday, should offer more clues on the monetary policy outlook.
Attention is also on a sweeping tax-cut and spending bill, passed by House Republicans after markets closed on Thursday, that is set to swell the national deficit by over $US3 ($A4.6) trillion in the next decade.
Declining issues outnumbered advancers by a 2.1-to-1 ratio on the NYSE, and by a 1.86-to-1 ratio on the Nasdaq.
The S&P 500 posted 21 new 52-week highs and three new lows, while the Nasdaq Composite recorded 69 new highs and 32 new lows.
Wall Street's major indexes have slipped as heightened tariff tensions dampened risk sentiment, while Tesla shares slid after boss Elon Musk announced plans to launch a political party.
Treasury Secretary Scott Bessent said the US will make several trade announcements in the next 48 hours, ahead of a deadline on Wednesday to finalise trade pacts.
President Donald Trump said on Sunday that the country was closer to inking several trade pacts and would notify other countries of higher tariff rates by July 9.
He added that those duties are set to take effect on August 1.
In April, Trump unveiled a base tariff rate of 10 per cent on most countries and additional duties ranging up to 50 per cent, subsequently pushing the Nasdaq into a bear market.
Although he later delayed the effective date for all but 10 per cent until July 9.
The new date offers countries a three-week window for further negotiations.
Trump also threatened an extra 10 per cent tariff on countries aligning themselves with the "Anti-American policies" of the BRICS group of Brazil, Russia, India, China and South Africa.
In early trading on Monday, the Dow Jones Industrial Average fell 207.65 points, or 0.46 per cent, to 44,620.88, the S&P 500 lost 27.38 points, or 0.44 per cent, to 6,251.97 and the Nasdaq Composite lost 115.56 points, or 0.56 per cent, to 20,485.13.
Nine of the eleven major S&P sectors were trading in the red, with consumer discretionary falling the most by 1.0 per cent.
Electric vehicle maker Tesla dropped 6.8 per cent, on track for its worst day in over a month, after Musk announced the formation of a political party named the American Party, marking a new escalation in his feud with Trump.
"Tesla investors are starting to vote their displeasure with him getting back into politics. The potential for him to start his own American party is just the exact opposite of what Tesla investors want," said Art Hogan, chief market strategist at B Riley Wealth.
Shares of WNS jumped 14.2 per cent after the French IT services firm Capgemini agreed to buy the outsourcing firm for $US3.3 billion ($A5.1 billion) in cash.
Monday's pullback also comes after the S&P 500 and the Nasdaq closed at record highs on Thursday following a surprisingly strong jobs report that pointed to resilience in the labour market.
The Dow was about 1.0 per cent away from an all-time high.
Solid jobs data also backed the Federal Reserve's cautious stance on future interest rate cuts.
Traders have fully priced out a July rate cut, with September odds at 64.4 per cent, according to CME Group's FedWatch tool.
Trump's inflation-causing tariff policies have further complicated the Fed's path to lower rates.
As a result, minutes of its June meeting, scheduled for release on Wednesday, should offer more clues on the monetary policy outlook.
Attention is also on a sweeping tax-cut and spending bill, passed by House Republicans after markets closed on Thursday, that is set to swell the national deficit by over $US3 ($A4.6) trillion in the next decade.
Declining issues outnumbered advancers by a 2.1-to-1 ratio on the NYSE, and by a 1.86-to-1 ratio on the Nasdaq.
The S&P 500 posted 21 new 52-week highs and three new lows, while the Nasdaq Composite recorded 69 new highs and 32 new lows.
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The spate of letters showed Trump has returned to the aggressive trade posture that he took in April when he announced a slew of reciprocal tariffs against trading partners that sent markets tumbling before the White House delayed implementation. But with the stock market recently hitting record highs and the US economy still resilient, Trump is showing no signs of slowing down his trade war. He promised to use the 90-day delay in April to strike dozens of new trade deals, but has only secured framework agreements with Britain, China and Vietnam. The EU has hoped to reach a comprehensive trade agreement with the US for the 27-country bloc. Trump's letter to the EU included a demand that Europe drop its own tariffs. "The European Union will allow complete, open Market Access to the United States, with no Tariff being charged to us, in an attempt to reduce the large Trade Deficit," he wrote. 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Mexico sends more than 80 per cent of its total exported goods to the US and free trade with its northern neighbour drove Mexico to become the top US trading partner in 2023. The EU had initially hoped to strike a comprehensive trade agreement but more recently had scaled back its ambitions and shifted toward securing a broader framework deal similar to the one Britain brokered that leaves details to be negotiated. The bloc is under conflicting pressures as powerhouse Germany urged a quick deal to safeguard its industry, while other EU members, such as France, have said EU negotiators should not cave into a one-sided deal on US terms. Bernd Lange, the head of the European Parliament's trade committee, said Brussels should enact countermeasures as soon as Monday. "This is a slap in the face for the negotiations. This is no way to deal with a key trading partner," Lange told Reuters. President Donald Trump has threatened to impose a 30 per cent tariff on imports from Mexico and the European Union starting in August, after weeks of negotiations with the major US trading partners failed to reach a comprehensive trade deal. In an escalation of a trade war that has angered US allies and rattled investors, Trump announced the latest tariffs in separate letters to European Commission President Ursula von der Leyen and Mexican President Claudia Sheinbaum on Saturday. Mexican President Claudia Sheinbaum said she was sure an agreement can be reached. "I've always said that in these cases, what you have to do is keep a cool head to face any problem," Sheinbaum said at an event in the Mexican state of Sonora. "(But) there's something that's never negotiable: the sovereignty of our country," she said. Trump sent similar letters to 23 other trading partners this week, including Canada, Japan and Brazil, setting blanket tariff rates ranging from 20 per cent up to 50 per cent, as well as a 50 per cent tariff on copper. The US president said the 30 per cent rate was "separate from all sectoral tariffs", indicating 50 per cent levies on steel and aluminium imports and a 25 per cent tariff on auto imports would remain. The August 1 deadline gives the targeted countries time to negotiate. Some investors and economists have also noted Trump's pattern of backing off his tariff threats. The spate of letters showed Trump has returned to the aggressive trade posture that he took in April when he announced a slew of reciprocal tariffs against trading partners that sent markets tumbling before the White House delayed implementation. But with the stock market recently hitting record highs and the US economy still resilient, Trump is showing no signs of slowing down his trade war. He promised to use the 90-day delay in April to strike dozens of new trade deals, but has only secured framework agreements with Britain, China and Vietnam. The EU has hoped to reach a comprehensive trade agreement with the US for the 27-country bloc. Trump's letter to the EU included a demand that Europe drop its own tariffs. "The European Union will allow complete, open Market Access to the United States, with no Tariff being charged to us, in an attempt to reduce the large Trade Deficit," he wrote. Von der Leyen said the 30 per cent tariffs "would disrupt essential transatlantic supply chains, to the detriment of businesses, consumers and patients on both sides of the Atlantic". The EU "will take all necessary steps to safeguard EU interests, including the adoption of proportionate countermeasures if required", she said. Mexico's economy ministry said "it was unfair treatment". Mexico's proposed tariff level is lower than Canada's 35 per cent, with both letters citing fentanyl flows even though government data shows the amount of the drug seized at the Mexican border is significantly higher than the Canadian border. "Mexico has been helping me secure the border, BUT, what Mexico has done, is not enough. Mexico still has not stopped the Cartels who are trying to turn all of North America into a Narco-Trafficking Playground," Trump wrote. Mexico sends more than 80 per cent of its total exported goods to the US and free trade with its northern neighbour drove Mexico to become the top US trading partner in 2023. The EU had initially hoped to strike a comprehensive trade agreement but more recently had scaled back its ambitions and shifted toward securing a broader framework deal similar to the one Britain brokered that leaves details to be negotiated. The bloc is under conflicting pressures as powerhouse Germany urged a quick deal to safeguard its industry, while other EU members, such as France, have said EU negotiators should not cave into a one-sided deal on US terms. Bernd Lange, the head of the European Parliament's trade committee, said Brussels should enact countermeasures as soon as Monday. "This is a slap in the face for the negotiations. This is no way to deal with a key trading partner," Lange told Reuters. President Donald Trump has threatened to impose a 30 per cent tariff on imports from Mexico and the European Union starting in August, after weeks of negotiations with the major US trading partners failed to reach a comprehensive trade deal. In an escalation of a trade war that has angered US allies and rattled investors, Trump announced the latest tariffs in separate letters to European Commission President Ursula von der Leyen and Mexican President Claudia Sheinbaum on Saturday. Mexican President Claudia Sheinbaum said she was sure an agreement can be reached. "I've always said that in these cases, what you have to do is keep a cool head to face any problem," Sheinbaum said at an event in the Mexican state of Sonora. "(But) there's something that's never negotiable: the sovereignty of our country," she said. Trump sent similar letters to 23 other trading partners this week, including Canada, Japan and Brazil, setting blanket tariff rates ranging from 20 per cent up to 50 per cent, as well as a 50 per cent tariff on copper. The US president said the 30 per cent rate was "separate from all sectoral tariffs", indicating 50 per cent levies on steel and aluminium imports and a 25 per cent tariff on auto imports would remain. The August 1 deadline gives the targeted countries time to negotiate. Some investors and economists have also noted Trump's pattern of backing off his tariff threats. The spate of letters showed Trump has returned to the aggressive trade posture that he took in April when he announced a slew of reciprocal tariffs against trading partners that sent markets tumbling before the White House delayed implementation. But with the stock market recently hitting record highs and the US economy still resilient, Trump is showing no signs of slowing down his trade war. He promised to use the 90-day delay in April to strike dozens of new trade deals, but has only secured framework agreements with Britain, China and Vietnam. The EU has hoped to reach a comprehensive trade agreement with the US for the 27-country bloc. Trump's letter to the EU included a demand that Europe drop its own tariffs. "The European Union will allow complete, open Market Access to the United States, with no Tariff being charged to us, in an attempt to reduce the large Trade Deficit," he wrote. Von der Leyen said the 30 per cent tariffs "would disrupt essential transatlantic supply chains, to the detriment of businesses, consumers and patients on both sides of the Atlantic". The EU "will take all necessary steps to safeguard EU interests, including the adoption of proportionate countermeasures if required", she said. Mexico's economy ministry said "it was unfair treatment". Mexico's proposed tariff level is lower than Canada's 35 per cent, with both letters citing fentanyl flows even though government data shows the amount of the drug seized at the Mexican border is significantly higher than the Canadian border. "Mexico has been helping me secure the border, BUT, what Mexico has done, is not enough. Mexico still has not stopped the Cartels who are trying to turn all of North America into a Narco-Trafficking Playground," Trump wrote. Mexico sends more than 80 per cent of its total exported goods to the US and free trade with its northern neighbour drove Mexico to become the top US trading partner in 2023. The EU had initially hoped to strike a comprehensive trade agreement but more recently had scaled back its ambitions and shifted toward securing a broader framework deal similar to the one Britain brokered that leaves details to be negotiated. The bloc is under conflicting pressures as powerhouse Germany urged a quick deal to safeguard its industry, while other EU members, such as France, have said EU negotiators should not cave into a one-sided deal on US terms. Bernd Lange, the head of the European Parliament's trade committee, said Brussels should enact countermeasures as soon as Monday. "This is a slap in the face for the negotiations. This is no way to deal with a key trading partner," Lange told Reuters.
