Trump to Announce Reciprocal Tariffs at 4 p.m. Today
WSJ: "Three Plans Under Review"... Final Decision Still Unclear
Tesla's Q1 Deliveries Drop Amid Anti-Musk Sentiment
The three major indices of the U.S. New York stock market showed slight declines in early trading on the 2nd (local time) ahead of President Donald Trump's announcement on reciprocal tariffs. With the targets and rates of the U.S. reciprocal tariffs still unclear, the market is holding its breath, anxiously awaiting the 'big event' set to unfold immediately after the close.
As of 10:24 a.m. in the New York stock market that day, the Dow Jones Industrial Average (Dow Index), centered on blue-chip stocks, was down 24.33 points (0.06%) from the previous trading day, standing at 41,965.63. The S&P 500 Index, focused on large-cap stocks, fell 5.24 points (0.09%) to 5,627.83, and the Nasdaq Index, centered on tech stocks, dropped 6.8 points (0.04%) to 17,443.09.
By individual stocks, U.S. electric vehicle maker Tesla was down 2.36%. On that day, Tesla announced that its vehicle deliveries in the first quarter of this year reached 336,681 units. This represents a 13% decrease compared to the same period last year and is the lowest since the second quarter of 2022. The growing backlash against Elon Musk, Tesla's CEO and head of the Department of Government Efficiency (DOGE), who is known as President Donald Trump's 'First Buddy,' is cited as a major reason for the sluggish vehicle sales. The reorganization of global factory operations to upgrade the flagship 'Model Y' also contributed to the reduced production volume. Nvidia fell 1.24%, while Apple rose 0.22%.
Investors are awaiting President Trump's reciprocal tariff announcement scheduled for 4 p.m. that day (5 a.m. on the 3rd Korean time) at the White House Rose Garden. According to local media such as The Wall Street Journal (WSJ), Trump is considering three options: Plan 1 (universal tariff), imposing a uniform 20% tariff on all imports; Plan 2 (reciprocal tariffs), applying different rates to each country based on their tariff rates against the U.S.; and Plan 3, imposing tariffs on all exports from certain countries. Bloomberg reported that as of the previous day, President Trump had not yet made a final decision.
President Trump is expected to implement the reciprocal tariffs immediately upon announcement and then engage in trade negotiations with various countries. U.S. Treasury Secretary Scott Baesant told lawmakers that the reciprocal tariffs would serve as a "cap." This suggests a 'tariffs first, negotiations later' approach.
Following the reciprocal tariff announcement, President Trump is also expected to sequentially announce item-specific tariffs on semiconductors, pharmaceuticals, and lumber, as previously indicated. Local media reported that copper tariffs could also be formalized within weeks. The frontlines of the tariff war initiated by Trump are expanding comprehensively, heightening concerns about a global trade war.
Mayungyu, Chief Investment Officer (CIO) of BMO Wealth Management, analyzed, "The entire market is anxiously waiting to gauge how severe the tariff war will be and how much damage it will cause to the economy and corporate earnings."
Government bond yields remained steady. The 10-year U.S. Treasury yield, a global bond yield benchmark, stood at 4.14%, and the 2-year U.S. Treasury yield, sensitive to monetary policy, was at 3.88%, both unchanged from the previous trading day.
© The Asia Business Daily(www.asiae.co.kr). All rights reserved.
