Trump’s Tariff Tsunami: Markets Plunge Amidst Chaos

Follow Finance Newso’s extensive reporting on the significant tariff plan introduced by President Trump here.

This weekend appears to be serene for President Trump, despite the turmoil experienced by stock market investors following the announcement of new tariffs.

The White House tweeted an image of Trump walking outdoors, with the wind tousling his hair, suit jacket, and tie, captioned with the upbeat phrase, “Almost Friday.”

This lighthearted post sharply contrasted the dismal state of Wall Street, where major stock indices experienced considerable declines.

— Dan Mangan

Nissan’s luxury division, Infiniti, has put a temporary stop to the production of two Mexico-manufactured crossovers intended for the U.S. market due to the recent 25% tariffs on imported vehicles enacted by Trump.

According to a memo from Tiago Castro, Infiniti Americas Vice President, production of the QX50 and QX55 models for the U.S. is paused “until further notice,” as reported by Automotive News.

A spokesperson confirmed this development to Finance Newso, adding that Nissan is currently evaluating its production and supply chain strategies to enhance efficiency and sustainability.

Nissan signaled they would continue to adapt production based on market conditions and needs.

Additionally, the company announced it will retain two shifts of production for the Nissan Rogue crossover at its plant in Smyrna, Tennessee, which is exempt from the new auto tariffs.

Nissan had initially planned to reduce Rogue production to one shift this month.

— Michael Wayland

The European Union and Switzerland, major markets for luxury items, have been subject to tariffs of 20% and 31%, respectively.

JPMorgan analysts noted that Swiss watchmakers, particularly, are more vulnerable than their luxury peers to these new tariffs.

Firms such as Swatch Group and Richemont are expected to be significantly impacted due to their slim profit margins. In response to the tariff news, Swatch Group stock fell approximately 4%, while Compagnie Financière Richemont’s shares declined by 6.3%.

Brands like Kering (owner of Gucci) and Burberry are also at risk, suffering from muted profit margins and limited ability to adjust pricing against the backdrop of weakening brand momentum. Kering and Burberry’s shares dropped 7.5% and 9.2%, respectively.

In contrast, luxury titan LVMH’s wine and spirits division, which includes the cognac brand Hennessy, is projected to be among the hardest hit.

Hermès is anticipated to withstand the tariffs better than most, with estimated damages ranging from roughly 3% to 5% due to its lower dependence on U.S. sales and robust pricing strategies.

LVMH saw a decline of more than 3% in its stock value.

— Hayley Cuccinello

Correction: This piece has been updated to clarify that Hermes operates as a separate publicly traded entity.

Despite his team’s previous insistence that the tariffs were non-negotiable, President Trump has indicated a readiness to engage in discussions about the new duties with other nations.

Trump stated he would consider negotiating tariffs if other countries present “something phenomenal,” as reported by Reuters during his remarks onboard Air Force One.

Earlier, top trade advisor Peter Navarro maintained that the sweeping tariffs were “not a negotiation,” underscoring the contradicting narratives emerging from the administration.

— Kevin Breuninger

The repercussions of the new tariffs were felt across major market players, with companies like Apple and Nike significantly contributing to the S&P 500’s sharpest decline since 2020.

However, the total economic impact of Trump’s tariffs is estimated at approximately $1 trillion, revealing potential severe consequences for both domestic markets and global supply chains, affecting everyday consumers across the U.S.

Trade experts are doubtful about the likelihood of rapid resolution through negotiations, with many warning of a protracted manufacturing crisis before any potential benefits from revitalization materialize.

According to shipping giant Maersk, the situation is unlikely to bode well for the global economy.

Read the full story on the extensive impact of Trump’s tariffs here.

— Lori Ann LaRocco

Peter Navarro affirmed that Trump’s recently imposed tariffs are not being utilized as leverage in negotiations with other nations.

“This is not a negotiation,” Navarro stated in an interview on Finance Newso’s “Closing Bell: Overtime,” calling the situation a national emergency rather than a bargaining tool.

— Kevin Breuninger

Goldman Sachs’ Lindsay Rosner highlighted that the newly enacted tariffs could hinder economic growth, with the question remaining as to the extent of this impact.

The extent will depend on responses from other countries and whether the Trump administration is open to negotiations, Rosner noted during a conference at Goldman Sachs’ New York office.

She further indicated that not all sectors will be equally vulnerable to the tariffs’ effects and expressed a desire to observe the Federal Reserve’s response. “They need to be reactive,” Rosner stressed, indicating that stagflation—a scenario where inflation rises amid stagnating economic growth—may become a reality.

Rosner voiced concerns that the tariffs might just be the beginning and speculated on what further actions the Trump administration might take.

— Hayley Cuccinello

Boeing’s shares dropped by 10%, causing ripples across the aerospace sector as companies evaluated the tariffs’ impact on their supply networks.

General Electric’s GE Aerospace faced a similar downturn, reflecting concerns over potential supply chain disruptions amid rising tariff costs.

Boeing’s production lines span the globe, with parts sourced internationally, raising questions around how these tariffs will ultimately affect operations.

Jefferies analyst Sheila Kahyaoglu remarked on the uncertainty surrounding the regulations’ application in the aerospace domain and noted that the repercussions on production costs are unavoidable.

Leslie Josephs

The Consumer Brands Association (CBA), representing major consumer companies like Coca-Cola and Procter & Gamble, is seeking exemptions for crucial ingredients and materials that are not feasible to produce in the U.S.

The CBA cited the limitations of U.S. agriculture in producing tropical fruits and other items affected by tariffs of up to 47%. As a result, manufacturers and retailers may pass increased costs onto consumers.

Household products reliant on inputs such as wood pulp may also see pricing hikes.

Read further details on the impact here.

— Amelia Lucas

The Federal Reserve could find itself in a precarious situation if tariffs drive inflation while simultaneously hampering economic growth, which might reduce the likelihood of interest rate cuts.

Market sentiments are leaning towards the idea that, without successful negotiations to lower the tariffs, core inflation could surge above 3% this year, with potential stagnation or negative growth as unemployment rates increase.

Jonathan Pingle, chief U.S. economist at UBS, noted that the Fed’s response will be crucial and that they will need to remain agile and responsive to upcoming developments.

— Jeff Cox

U.S. markets continue to experience declines as investors absorb the implications of Trump’s extensive tariffs. The market sell-off has gained momentum as trading sessions close around 4 p.m. ET.

— Elisabeth Cordova

According to The Verge, the methodology the White House employed to craft its broad tariff policy seems to have simplistic arithmetic roots, resembling calculations from artificial intelligence chatbots.

Journalist James Surowiecki noted that the Trump administration appeared to have divided the trade deficit with each country by its exports to the U.S. to establish tariff rates, a method that lacks alignment with traditional customs practices.

This analysis indicates that the U.S. may have only focused on the goods deficit, neglecting the services aspect, which might lead to distorted tariff rates.

For additional details on this revelation, click here.
— CJ Haddad

Chair of the Federal Trade Commission, Andrew Ferguson, warned U.S. businesses against engaging in price-fixing following the announcement of tariffs.

Ferguson stated the FTC would be vigilant in ensuring American companies compete fairly on pricing and stated that the new tariffs should not be misinterpreted as a license to engage in unlawful practices.

— Michele Luhn

President Trump characterized the initial response to his sweeping tariff initiative as positive.

He forecasted a booming economy and stock market recovery, asserting that companies have pledged nearly $7 trillion in investments. “Our country is on the brink of economic prosperity,” he claimed.

— Kevin Breuninger

Brad Gerstner, CEO of Altimeter Capital, conveyed that several CEOs from prominent businesses regard Trump’s tariff strategy as overly aggressive, urging that it may have detrimental effects if not moderated. During an appearance on Finance Newso’s “Halftime Report,” he mentioned discussions with multiple Business Roundtable leaders who harbor similar sentiments.

Notably, Gerstner refrained from divulging specific names but referenced major companies within the Business Roundtable, which comprises the leaders of many of America’s largest firms.

He criticized the tariff policy as exemplifying protectionism rather than advocating for equitable global trade.

— Jesse Pound

Trump is set to leave the White House for a dinner in Miami hosted by LIV Golf, a tour known for its events at Trump properties. Following the dinner, he will head to his Mar-a-Lago resort in Palm Beach.

— Kevin Breuninger

Brad Gerstner, CEO of Altimeter Capital, expressed confidence in Nvidia’s resilience against the broader impact of tariffs on technology sectors.

The chipmaker, known for its GPUs powering artificial intelligence technologies, could potentially navigate these tariff challenges better than other companies, given that semiconductors are reportedly exempt from new tariffs, termed a “wise exception.” Gerstner noted the soaring demand for Nvidia’s GPUs amid the ongoing AI boom.

— Ashley Capoot

The recent tariffs are set to affect leading U.S. dollar store chains differently, creating a competitive divide. Dollar Tree’s stock fell by over 10%, negatively impacted alongside other retailers dependent on low-cost imports. In contrast, Dollar General’s stock observed a slight increase, climbing over 4%.

With the implementation of an additional 34% tariff on Chinese imports, totaling 54% since Trump’s second term initiation, Dollar Tree faces a significant cost increase given that approximately 32% of its goods derive from China, based on UBS analysts’ assessments. Dollar General has only about 4% reliance on Chinese products.

Dollar Tree’s CEO previously indicated a willingness to raise prices to counter the tariff impacts.

— Jacob Pramuk

Reid Hoffman criticized Trump’s tariff policy, stating it represents a long-term strategy aimed at adversely impacting everyday Americans while consolidating power at higher levels, through a social media commentary.

A key Democratic donor and former supporter of Kamala Harris, Hoffman has been influential in voicing opposition to the Trump administration’s policies, previously raising alarm about potential retaliation against dissenting business leaders.

In his latest remarks, he stressed that the Trump administration’s actions have eroded trust in U.S. markets, leading to detrimental effects on economic stability.

— Annie Palmer

Small-cap stock indices have entered a bear market phase as the market reacts negatively to Trump’s tariff announcement. Stay tuned to Finance Newso’s market blog for ongoing updates.

— Sean Conlon

General Motors plans to temporarily boost production of its pickup trucks at its Indiana plant in response to the auto industry’s adjustments to President Trump’s 25% tariffs on imported vehicles.

The company confirmed the increase in production, without directly referencing tariffs, by stating it would be making operational adjustments and hiring temporary staff to accommodate current manufacturing requirements.

This increase comes on the heels of the anticipated production slowdown for certain models due to tariff-related pressures.

— Michael Wayland

American consumers may be inclined to shift from imported beverages to domestically produced alternatives this summer, given the hefty tariffs levied on European wines, spirits, and Mexican beers.

Notably, the Trump administration’s 20% tariff on EU imports and a 25% levy on popular Mexican beers like Modelo, are likely to impact sales, with stock shares of Constellation Brands dipping slightly as investors braced for these new tariffs.

While the latest tariff announcements have inflicted less damage than some of the harsher measures previously proposed, such as a 200% tariff on certain European products, it has nonetheless raised prices for some alcoholic beverages.

Read additional details regarding tariff impacts on the alcohol market.

— Amelia Lucas

Concerns regarding Trump’s tariffs pose risks for American AI companies, noted Matt Mittelsteadt from the Cato Institute. His statement emphasized how the sudden tax hikes on imports threaten to disrupt the sector during a critical period of growth, potentially harming innovation.

Shares of CoreWeave, an AI-focused company, dropped over 17%, while Nvidia’s stock fell nearly 7%. Tech giants Microsoft and Google also saw declines exceeding 2% as the market reeled from the tariff news.

— Hayden Field

Bill Ackman, CEO of Pershing Square, urged foreign leaders to engage with President Trump without delay to negotiate favorable trade terms, emphasizing Trump’s deal-making prowess as a potential path to resolving tariff conflicts.

Ackman praised Trump as a “tough, yet fair negotiator” and cautioned that countries imposing retaliatory tariffs could face severe consequences.

— Ashley Capoot

In retaliation to Trump’s auto tariffs, Canada has announced a matching 25% tariff on U.S. car imports. Prime Minister Mark Carney made it clear that the tariffs will target vehicles not compliant with the USMCA agreement, ensuring that auto parts and vehicle components from Mexico remain unaffected.

Carney acknowledged the benefits derived from the integrated manufacturing system between the two countries and highlighted Canada’s plans to develop frameworks that enable auto manufacturers to avoid these counter tariffs through continued production and investment in Canada.

— Michele Luhn

Commerce Secretary Howard Lutnick expressed confidence in the administration’s approach to tariffs, stating there is unlikely to be a reversal of the strategy.

Lutnick indicated that countries imposing retaliatory tariffs would be misguided in their strategies, emphasizing that the primary goal is to foster fairness in trade.

He noted that the administration intends to finalize a coherent strategy that promotes equity between nations.

— Kevin Breuninger

In light of the newly imposed tariffs, Danish jeweler Pandora is bracing for a significant financial impact, estimating an annual hit of approximately $178 million due to the U.S. tariffs on imports. The company plans to adjust strategies, either through price increases or supply chain alterations to mitigate losses.

Approximately 92% of Pandora’s jewelry is produced in Thailand, which is experiencing a 36% tariff on imported goods.

— Jacob Pramuk

A bipartisan initiative introduced in the Senate aims to require congressional approval for tariffs that exceed a two-month duration. The proposal would also mandate that the President notify Congress within 24 hours of announcing novel tariffs.

Senator Chuck Grassley, a Republican from Iowa, along with Democrat Maria Cantwell from Washington, expressed that Congress has overly ceded its authority to the executive regarding foreign commerce regulations.

The timeline for the bill’s voting remains uncertain.

— Dan Mangan

Commerce Secretary Howard Lutnick addressed concerns regarding potential grocery price surges tied to Trump’s tariffs, asserting that such increases are unlikely.

Lutnick expressed confidence that opening global markets will benefit American producers and consumers, leading to lower grocery prices over time.

He remarked, “Trust in Trump’s economic strategies will yield positive results. Let him manage the economy,” he added.

— Kevin Breuninger

Investors are increasingly drawn to fast-food stocks as patrons anticipate switching to less expensive dining options amid ongoing tariff pressures.

Restaurants like McDonald’s, Yum Brands, and Restaurant Brands International saw their share prices rise by over 1%, while other dining establishments faced notable declines.

Conversely, brands such as Chipotle Mexican Grill and Texas Roadhouse reported drops of 3% or more, amidst rising concerns regarding food and packaging costs due to higher tariffs.

Fast-food chains historically perform better during economic downturns as cash-strapped consumers opt for budget-friendly meal options.

The National Restaurant Association has cautioned that the latest wave of tariffs could escalate costs and pressure restaurant operators with ongoing supply chain uncertainties.

— Amelia Lucas

GE HealthCare’s shares plunged over 10% following the tariff news, reflecting apprehension regarding the impact on their global supply chains.

The medical device manufacturer generates its products across more than 20 countries and serves a global clientele.

A spokesperson reassured stakeholders that the company is committed to maintaining high-quality patient service even amid trade uncertainty.

Shares of Siemens Healthineers also dropped nearly 7% as the market reacted to tariff implications.

— Ashley Capoot

Trump’s expansive tariff strategy has implications that stretch far beyond traditional targets, impacting nations and regions as varied as actual penguin habitats to obscure territories.

Notably, several small Australian territories, including Heard and McDonald Islands, were subjected to tariffs, highlighting the breadth of the tariff scheme. Norfolk Island, with a modest population of 2,000, is also affected by extraordinary tariffs reaching 29% despite Australia itself facing a mere 10% tariff.

Australian Prime Minister Anthony Albanese remarked on the unusual nature of these tariffs, questioning the economic rationale behind punishing such remote locations.

Read the full details of these unconventional tariff applications.

— Sawdah Bhaimiya

Chipmaker stocks experienced a decline as the market reacted to Trump’s tariff measures despite being excluded from the latest levies. Concerns about looming tariffs in the future have begun influencing demand for tech products, further impacting stock performance.

The VanEck Semiconductor ETF plummeted by nearly 7%, with individual companies like Qorvo and Micron Technology experiencing sharp drops of over 12% each. Qualcomm, Broadcom, and Lam Research followed with declines exceeding 7%.

Nvidia and Taiwan Semiconductor Manufacturing also recorded decreases of over 6% amid the downturn.

— Samantha Subin

French President Emmanuel Macron called on French businesses to reconsider new investments in the U.S. following Trump’s sweeping tariffs, which he termed a “shock” to global trade relations.

Macron’s comments came after his meeting with industry representatives in France, where he discussed the potential implications of these tariff policies on international commerce.

The president denounced the aggressive tariff strategy, which includes a baseline tariff of 10% and additional duties on imports from countries like China and the European Union, affecting international trade flow.

— Yun Li

Former Treasury Secretary Steven Mnuchin expressed belief in the market’s ability to adapt to the new 10% baseline tariff affecting most countries, while expressing hopes for negotiations to potentially lower more severe tariff rates.

Mnuchin argued that significant adjustments to manufacturing bases will take substantial time and noted a negative market reaction to the tariff news.

— Kevin Breuninger

In a recent executive action, Trump has eliminated the ‘de minimis’ exemption for China and Hong Kong, which allowed goods valued under $800 to enter the U.S. duty-free. The exemption has facilitated the influx of inexpensive products from China.

The end of this policy will take effect on May 2, as per the executive order. Trump’s earlier intentions to close the loophole were initially halted due to concerns about overwhelming U.S. Customs and Border Protection with new enforcement burdens.

— Kevin Breuninger

Retail giants, including Target and Nike, endured severe losses as the market reacted negatively to the newly announced tariffs, impacting share prices significantly.

These retailers, along with others like Wayfair, American Eagle Outfitters, and Hasbro, all reached 52-week lows amid this tumultuous trading environment.

The tariffs are expected to present retail companies with difficult decisions in adjusting to higher costs stemming from imports from critical manufacturing hubs like China and Vietnam, leading to elevated prices for consumers.

The Footwear Distributors and Retailers of America report that nearly a third of footwear imports to the U.S. originated from Vietnam in 2023, heightening concerns over further retail price hikes.

— Melissa Repko

Finance Newso’s senior economics reporter Steve Liesman engaged in a spirited dialogue with Rick Santelli on the ramifications of Trump’s newly instituted tariffs on global economic conditions.

View the full discussion below:

Kevin Breuninger

Stellantis has announced the temporary suspension of production at two of its assembly plants in Canada and Mexico in response to the recently imposed tariffs.

The company will see approximately 900 workers from supporting facilities laid off, along with about 4,500 hourly positions at the Canadian plant. Staff at the Mexican plant will report but will halt vehicle production owing to contract stipulations.

This production halt will commence on Monday, extending for two weeks at its Ontario facility and throughout the month of April at its Mexican plant.

Antonio Filosa, head of Stellantis North America, indicated ongoing assessments of the tariffs’ medium- and long-term impact on operations.

Michael Wayland, Michele Luhn

The market continues to isolate the impacts of Trump’s tariffs on corporate earnings short-term, adjusting as analysts interpret the longer-term implications in various sectors. Stay updated with our comprehensive market analysis.

— Vincent D’Onofrio