NEW YORK (AP) — Wall Street experienced sharp swings Monday amid fears of a trade war.
U.S. stocks initially dropped on worries over tariffs proposed by President Donald Trump, but pared some losses after Mexico announced a one-month delay following talks with Trump.
By the close, the S&P 500 had fallen 0.8%, while the Dow Jones Industrial Average dropped 122 points (0.3%) and the Nasdaq sank 1.2%. Earlier in the day, the S&P 500 had dipped nearly 2%, and the Dow had fallen as much as 665 points, reflecting concerns over the potential impact of tariffs on U.S. businesses.
Technology stocks and companies likely to be affected by higher interest rates linked to the tariffs saw some of the biggest declines. Losses eased after Mexican President Claudia Sheinbaum said tariffs on Mexican goods would be paused for a month, and later Canadian Prime Minister Justin Trudeau confirmed a similar 30-day delay. The Dow even briefly posted a small gain in the afternoon.
Many investors had hoped Trump’s talk of tariffs would be temporary — part of negotiations rather than a permanent policy. Monday’s developments left uncertainty over whether tariffs are a negotiating tactic or a policy direction.
Traders feared an escalating trade war could harm global economies, including the U.S. “Living in the Midwest, I might feel the trade war soonest and most,” said Brian Jacobsen, chief economist at Annex Wealth Management, citing the region’s reliance on Canadian crude oil for gasoline production.
Crude oil prices reflected the volatility, swinging from $72.53 per barrel on Friday to nearly $75 Monday morning, before dipping back toward $72. Trump warned Americans that tariffs may bring “some pain” but said it would be “worth the price” to strengthen the U.S., adding that import taxes on the EU and possibly the U.K. would “definitely happen.”
