Wall Street slips after Trump's steel tariff threat
Wall Street's main indexes have dipped after US President Donald Trump said he plans to double tariffs on imported steel and aluminium, fuelling more uncertainty around United States trade policies.
Trump said late on Friday he planned to increase tariffs on imported steel and aluminium to 50 per cent from 25 per cent starting on Wednesday, just hours after he accused China of violating an agreement.
Shares of US steel companies rose, with Cleveland-Cliffs jumping 28.3 per cent, Nucor up 11.5 per cent and Steel Dynamics 11.3 per cent higher.
However, shares of car makers fell.
Ford and General Motors both were down more than 4.0 per cent.
"People have been thinking about that (steel tariffs) and trying to formulate the economic impact. It presents the markets with a lot of uncertainty right now," said Peter Andersen, founder at Andersen Capital Management.
The increased levies risk deepening Trump's global trade war, and dousing enthusiasm in markets stemming from the US president's softer trade stance that drove a recovery in risky assets last month.
A temporary relief on some levies on China and a roll-back of steep tariff threats on the European Union, along with strong earnings and improving economic picture helped the benchmark S&P 500 log its best monthly performance in 18 months in May.
Also fuelling risk-off moves in global markets, Ukraine struck some of Russia's nuclear-capable bombers on Sunday, renewing concerns around further escalation of the war.
In early trading on Monday, the Dow Jones Industrial Average fell 208.46 points, or 0.49 per cent, to 42,061.61, the S&P 500 lost 15.78 points, or 0.27 per cent, to 5,895.91 and the Nasdaq Composite lost 10.10 points, or 0.05 per cent, to 19,103.67.
Eight of the 11 major S&P 500 sub-sectors fell, with consumer discretionary stocks declining the most with an about 1.0 per cent fall.
On the flip side, energy rose 0.8 per cent tracking a rise in oil prices.
US-listed energy stocks advanced after producer group OPEC+ kept output increases in July at the same level as the previous two months.
Most megacap and growth stocks were down, with Tesla leading losses with a 2.5 per cent decline after it reported lower monthly sales for Portugal, Denmark and Sweden.
On the economic front, the Institute for Supply Management's (ISM) gauge of manufacturing activity came in at 48.5 for May, below estimates of 49.3, according to economists polled by Reuters.
Focus will be on comments from Federal Reserve chair Jerome Powell later in the day as he presents opening remarks before the Federal Reserve Board International Finance Division's 75th anniversary conference at 1pm ET.
Investors are also looking ahead to a crucial non-farm-payrolls report on Friday to gauge the US labour market's strength amid tariff volatility.
Declining issues outnumbered advancers by a 1.84-to-1 ratio on the NYSE and by a 1.43-to-1 ratio on the Nasdaq.
The S&P 500 posted 10 new 52-week highs and four new lows while the Nasdaq Composite recorded 51 new highs and 63 new lows.
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