Stocks fall, dollar up on tariffs plan
Trump said on Monday the US would impose a 25% tariff on imports from Japan and South Korea beginning August 1 as he unveiled the first two of what he has said will be a wave of letters to trading partners outlining the new levies they face.
US-listed shares of Japanese automotive companies fell, with Toyota Motor down 4.1% and Honda Motor off by 3.8%.
The United States will make several trade announcements in the next 48 hours, Treasury Secretary Scott Bessent said earlier on Monday, with a deadline set for Wednesday to get trade deals done.
"We're down (in stocks) after the long weekend, and it's somewhat of a critical week in terms of the tariffs," said Peter Cardillo, chief market economist at Spartan Capital Securities in New York. "The prospect of what may or may not happen with the trade deals... is causing investors to be somewhat cautious."
Tariffs are expected to increase prices and to slow down growth, though uncertainty over the ultimate policies may be a bigger drag as it leads businesses to postpone decisions. S&P 500 companies are soon expected to begin reporting results on the second quarter. Trump announced in April a 10% base tariff rate on most countries and higher "reciprocal" rates ranging up to 50%, with an original deadline of this Wednesday.
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