The shares demolished on Tuesday in the morning trading on Wall Street, as the commercial war between the United States -and his key trade partners escalated, but uncertainty about the duration of the tariff made the influence on the scattered global markets.
Tariffs between the United States, Canada, Mexico and China helped expand the recent decline in American shares that encouraged signs of weakness in the economy.
The S&P 500 fell 1.7 percent, weighed almost every sector, except for relatively safer investments in real estate and utilities.
The Canadian main index of shares has reduced almost 500 points in early trading, and the industrial average Dow Jones, one of the biggest health indicators of the American economy, rejected 772 points, or 1.7 percent of the 11:03 ET. The Nasdaq composite dropped 1.5 percent.
The markets in Europe dropped sharply, while the sections in Asia recorded a more modest fall.
Drops are following the steep sale on Monday. All in all, the fall has deleted all gains in markets since the election of US President Donald Trump in November, gains that have been mainly built on hopes for Trump policies that would strengthen the US economy. Concerns of tariffs that increase consumer prices and ruling inflation weighing both the economy and the Wall Street.
Imports from Canada and Mexico will now be taxed to 25 percent, and Canadian energy products are subject to 10 percent of import duties. The 10 -stopped tariff that Trump put in Chinese imports in February was doubled to 20 percent.
The retalies were fast.
China responded to new US tariffs, announcing that it would impose additional tariffs up to 15 percent of the import of key American farms, including chicken, pork, soybean and beef and expanded business control with key American companies.
Canada plans to slap the tariffs on more than $ 100 billion in US goods during 21 days. Mexico also plans to be tariff on the goods imported from the USA
Dollar Zvezan
The US index of dollars, which monitors the currency compared to six peers, reached the lowest level on Tuesday morning from December 6, because the concern about the influence of tariffs on the wider economy surpassed the expected reinforcement of the move.
“We have seen the dollar weakened, but I think it reflects the market assumptions about how the tariffs will have a negative impact, not only on external growth, but that it could have a negative impact on US growth,” said Brian Daingerfield, a foreign exchange strategist on Natwest Markets in New York, said Reuters.
After hitting a one -month late Monday after Trump’s confirmation of Tariff, the Canadian dollar strengthened a little overnight, while investors fled to traditional currencies with safe villas like Japanese Jen and Swiss Frank.
Analysts said many on the market hope that the tariffs will be quickly abolished if the contracts can be achieved.
“The price of the action suggests that the market participants remain hoping that tariff rates will not remain in force for long helping in restricting trade and economic disorder,” said Lee Hardman, a senior currency analyst at the Japanese banka bank.
Reaction to the market blurred in the middle of uncertainty
Uncertainty about the trade war-to experts unclear how long tariffs and counter-arts can last-it is one of the reason that the initial response in the market was not as bad as it could have been, according to one expert.
“What we do not know is the duration and that is key,” said Derek Holt, Vice President and Head of Capital Economics in Scotiabank, in clients. He added that Trump could be an unstable figure in terms of his decision -making, so it is not clear how much he is dedicated to maintaining a tariff.
“If they last, then the effects on [North American] The economy and markets will be much greater. This may not take long, given the guidelines from the automatic sector to start canceling and closing the plant within approximately one week after arrival. “
Holt said the retaliation of measures established by Canada, Mexico and China were not as extreme, at this stage, as they have now applied, a limiting part of the damage to the markets.
While Canada corresponds to 25 percent of tariffs, counter-arts target the smaller volume of American imports. Chinese tariffs on US goods will not enter into force until March 10, and Mexico will not announce which American products will target its counter-art until Sunday.
Douglas Porter, the main economist at Montreal Bank, said in a note to clients that if the tariffs stay in place for a year, Canada would “face the risk of moderate recession.”
“With a little confidence given the lack of historical precedent, we estimate that the tariffs will reduce the real GDP growth by approximately 1.5 PPTS to about 0.5 percent in 2025,” he wrote, adding that this reflects the expected reduction in the demand for Canadian slave from American customers, which makes around the fifth Canadian GDP.
Traders, firing companies
Tarife encourages the trader warnings, including Target and Best Buy, as they report on their latest financial results. The goal dropped 4.9 percent despite the beating of the Wall Street prognosis, reporting that it would be “meaningful pressure” to his earnings to start the year due to tariffs and other costs.
Best Buy fell by 13.9 percent after he gave investors a forecast of earnings weaker than expected and a warning on tariff influences.
It is expected that US President Donald Trump will start on March 4. National Adrienne Arsenault asks a journalist and a business professor to answer the viewers’ questions about how tariffs will affect prices, possible recession and Canadian diplomacy.
At the consumer level in Canada, some influences were immediately.
On Tuesday morning, the Ontario Alcoholic Website, which sells to the public, sells alcoholic beverages to the public, she has shown an error page indicating that his Internet service is “temporarily unavailable while removing us products in response to US tariffs on Canadian goods.”
Owners of companies in Canada are watching news with disgust. Steve Himel, president of Henderson Brewing Company, told CBC News Network that the company already has to change its annual business plan.
“We will start to experience this pain within a few days or weeks. But the uncertainty of this is something we feel right at the moment,” he said. “Will this last a week or a month? We don’t know.”
