Traders at the New York Stock Exchange navigated a tumultuous day on Monday as markets reacted to President Donald Trump’s announcement of new tariffs over the weekend. Despite opening with significant losses, the Dow Jones Industrial Average managed to erase these losses and turn slightly positive by the afternoon. However, the broader S&P 500 remained down by 0.4%, and the Nasdaq 100 was lower by 0.7%. The Cboe Volatility Index, which is a measure of market volatility, surged above 17, reaching its highest level since January 2023. Meanwhile, the price of gold reached a record high at $2,818.27 per ounce, and Bitcoin also saw an increase in price following a sell-off earlier in the day.
President Trump’s announcement included imposing 25% tariffs on all goods imported from Canada and Mexico, with the exception of a 10% tariff on Canadian energy imports. Additionally, a 10% levy was announced on all goods imported from China. While acknowledging that the tariffs could lead to some hardships for U.S. consumers, Trump believed the move would be justified in the long run.
The tariffs against Mexico, scheduled to take effect on Tuesday, were later announced to be suspended by Trump on Monday afternoon. Some GOP officials viewed these tariffs as a strategic negotiation tactic. Senator Eric Schmitt of Missouri emphasized that the tariffs aimed to push Canada and Mexico to address the issue of fentanyl trafficking into the U.S., stating that these countries needed to choose between trading with the U.S. or supporting criminal organizations.
