Donald Trump Tariff impact on Stock market: How long will it continue?

U.S. stock futures fell on Wednesday, suggesting a retreat on Wall Street later, as U.S. President Donald Trump's latest tariff threats on auto, semiconductor and pharmaceutical imports injected a sense of caution into the markets.

Since his inauguration four weeks ago, Trump has imposed a 10 per cent tariff on all imports from China, on top of existing levies. He has also announced, and delayed for a month, 25 per cent tariffs on goods from Mexico and non-energy imports from Canada, Reuters reported.

Trump told reporters on Tuesday that sector-wide tariffs on pharmaceuticals and semiconductor chips would start at "25 per cent or higher", rising substantially over the course of a year. He intends to impose similar tariffs on autos as soon as April 2.



U.S. index futures were down 0.2 per cent, having pared earlier gains, which pointed to a modest decline for the S&P, which on Tuesday squeaked past its previous record closing high.

Donald Trump Tariff Threats

Overall, market reaction to Trump's threats was mostly muted as investors increasingly see them as smaller-scale bargaining tools.

"The global economy and global financial markets are not all about tariffs. They're also mainly about activity, corporate profitability and interest rates, and it's true that tariffs might impact those three elements, but it's mainly in a contained way, based on what we've seen so far," Lombard Odier economist Samy Chaar said.

"(Trump) should be taken seriously - in the end, tariffs will be higher ... however, you also have to do your work when it comes to assessing and evaluating the impact of these tariffs," he said.


Gold shrugged off the stronger dollar and rose 0.2 per cent on the day to $2,940 an ounce, having hit yet another record high.


"There must be a large number of traders who switch on their screens each morning expecting a $100-plus overnight slump in the price of gold. Instead, gold continues to make steady upside progress. It has been regularly posting fresh record highs since the beginning of February," David Morrison, senior market analyst at Trade Nation, said.

FAQs

Q1. What are current prices of Gold?
A1. Gold shrugged off the stronger dollar and rose 0.2 per cent on the day to $2,940 an ounce, having hit yet another record high.

Q2. Were U.S. index futures down?
A2. U.S. index futures were down 0.2 per cent, having pared earlier gains, which pointed to a modest decline for the S&P.