HONG KONG (AP) – US futures surged on Monday, while Asian stocks faced declines after US President Donald Trump announced a delay of the 50% threatened tariff on products from the European Union until July 9th.
Trump revealed this decision following a discussion with Ursula von der Leyen on Sunday.
Last week, he mentioned on social media that trade negotiations with the European Union “would not progress” and that a “straight 50%” tariff could take effect on June 1.
The S&P 500 futures rose by 1%, while Dow Jones Industrial Average futures climbed by 0.8%.
In Asian trading, Tokyo’s Nikkei 225 saw a 0.9% increase to 37,510.71, whereas Seoul’s Kospi gained 1.4% to reach 2,627.09.
However, Hong Kong’s Hang Seng index dropped by 1.2% to 23,330.21, and the Shanghai Composite Index declined by 0.1% to 3,343.86.
The Australian S&P/ASX 200 remained relatively unchanged at 8,360.50.
Other regional markets experienced similar declines.
US stocks fell on Friday as traders speculated whether Trump’s latest threat was merely a negotiating tactic.
The S&P 500 decreased by 0.7% to 5,802.82, marking its worst week in seven. The Dow Jones Industrial Average dipped 0.6% to 41,603.07, while the Nasdaq Composite fell 1% to 18,737.21.
Apple shares decreased by 3%, becoming the largest drag on the S&P 500 after Trump urged CEO Tim Cook to move iPhone production back to the US, warning of tariffs if “Apple must pay tariffs in the US.”
Later, Trump clarified that all smartphones manufactured overseas would incur taxes and that tariffs could be implemented by the end of June.
“I’m sure anyone making Samsung products will be impacted,” Trump commented. “Otherwise, it wouldn’t be fair.”
Trump has often criticized companies individually when he disapproves of their actions related to his tariffs and the uncertainty surrounding his trade war. Previously, he told Walmart, “We should absorb tariffs,” after the retailer indicated they would need to raise prices due to increased import costs from China.
Deckers Outdoor, the company behind Hoka and Ugg brands, became one of the latest firms expressing that economic uncertainties would prevent them from providing financial forecasts for the next year.
Despite reporting stronger-than-expected profits and revenues for the recent quarter, their share price plummeted by 19.9%.
Ross Stores fell by 9.8% after retracting full-year financial forecasts, citing that more than half of the products sold were sourced from China.
On a brighter note, Intuit’s shares rose by 8.1% following the company’s stronger-than-expected profits associated with TurboTax and Credit Karma.
Stocks in the nuclear sector also advanced after Trump signed an executive order aimed at expediting nuclear licensing, intended to rejuvenate the industry. Oklo, which is developing a fast-fission power plant, surged by 23%.
Trump’s recent tariff threat has rattled Wall Street, which had mostly recovered from previous losses due to the trade war. The S&P 500 previously dropped about 20% from its peak at one point last month, amid rising worries that Trump’s stringent tariffs might trigger a global recession. The index climbed within 3% of its all-time high after Trump suspended tariffs in several regions, notably China.
In other market news, early Monday, US benchmark crude rose by 22 cents to $61.75 per barrel, while international benchmark Brent crude increased by 21 cents to $64.42 per barrel.
The US dollar fluctuated, moving from 142.48 yen to 142.60 yen. The euro strengthened, rising from $1.1367 to $1.1412.
Source: apnews.com