Traders work on the floor of the New York Stock Exchange during afternoon trading on Aug. 2, 2024.
Michael M. Santiago | Getty Images
S&P 500 futures wavered on Tuesday as investors assessed the threat of new tariffs from President-elect Donald Trump.
Futures tied to the broad index and the Nasdaq 100 ticked up around 0.2% and 0.3%, respectively. Dow Jones Industrial Average futures slid 138 points, or 0.3%, hurt by a drop of more than 11% in Amgen following obesity drug trial results.
Trump on Monday night called for a 25% tariff on products from Mexico and Canada, as well as an additional 10% levy on Chinese goods. He has already said he would impose a tariff of up to 20% on all imports, and an additional duty of at least 60% on products from China.
To be sure, Wall Street appeared to be taking the news in stride, “both because investors don’t entirely believe the levies will wind up being implemented and as the headlines are counteracted by favorable year-end seasonality and decent earnings,” according to Adam Crisafulli of Vital Knowledge.
While the S&P 500 was little changed, some individual names and funds moved as investors analyzed potential impacts from the policies Trump discussed. Automakers Ford and General Motors slid more than 2% and 4%, respectively. The iShares MSCI Mexico ETF (EWW), which tracks a basket of equities tied to America’s southern neighbor, shed more than 1%.
Stocks are coming off an action-packed session fueled by Trump’s Treasury secretary pick, hedge fund executive Scott Bessent. Monday’s gains helped bolster the belief that the postelection rally is back in full gear following a brief breather.
Both the Dow and S&P 500 hit new intraday records in Monday’s session, with the former also finishing the day at an all-time closing high. The small cap-focused Russell 2000 also notched a fresh high, marking its first new intraday record since 2021.
That advance came as Treasury yields fell with traders taking a favorable view of Bessent leading the department. Many investors view the hedge fund manager as a champion of financial markets and the economy given his background, and as someone who could potentially counteract some of Trump’s aggressive trade aspirations.
“These policies may take more time to play through into the market actually get enacted,” NewEdge chief investment officer Cameron Dawson told CNBC’s “Closing Bell” on Monday of potential new policies from the Treasury pick. “It’s definitely a question mark of how much impact he can have in the short run as we round the year.”
Investors will monitor Federal Reserve meeting minutes due out at 2 p.m. ET for insights into the path of monetary policy.
The U.S. market is closed Thursday for the Thanksgiving holiday and set to close early Friday, with volume expected to remain light.
