At the beginning of trading, the Nasdaq index, dominated by technology stocks, fell by approximately 2%. Oil prices increased. Futures for U.S. crude oil surged above $74 per barrel before losing ground. The dollar strengthened against several currencies, with the Canadian dollar, euro, and Mexican peso being the hardest hit.
Investors shifted their focus to longer-term Treasury bonds, resulting in a decline in yields for both 10-year and 30-year bonds.
Bloomberg reports that stocks fell across the board, with the S&P 500 dropping by 1.8%. The basket of stocks from UBS Group AG, which is vulnerable due to proposed tariffs, declined by 4.2%. Automakers heavily reliant on Mexico, Canada, and China also saw their stock prices fall. Semiconductor companies were similarly affected. As new tariffs threaten to disrupt the tightly integrated North American oil market, shares of energy companies also declined.
According to strategists at Goldman Sachs Group Inc., there is a risk of a 5% drop in American stocks over the coming months, as the latest round of tariffs imposed by the Trump administration worsens earnings forecasts.
Some economists anticipate that the tariffs could push neighboring countries into recession while simultaneously putting pressure on domestic economic growth, as reported by The Wall Street Journal. The tariffs may also reduce profits for the largest American companies.