US stock futures tumbled on Monday as fears about the economic impact of President Trump’s upcoming tariffs escalated, extending Friday’s selloff.
Markets React to Looming Tariff Announcement
Futures tied to the Dow Jones Industrial Average fell by 204 points, or 0.49%, while S&P 500 futures and Nasdaq 100 futures dropped by 0.71% and 1.25%, respectively, continuing the downward trend from Friday’s rout.
On Wednesday, the Trump administration is set to impose a new round of tariffs, including a 25% tax on cars not made in the US. Additionally, President Trump is expected to announce reciprocal tariffs on a variety of foreign products.
Economic Concerns and Rising Recession Fears
Economists warn that these tariffs could severely affect the US economy, even while limiting the Federal Reserve’s ability to reduce interest rates due to a potential spike in inflation.
Bruce Kasman, chief economist at JPMorgan, stated that recession risks have risen to a 40% probability, driven by concerns that aggressive US trade policies could hurt business and consumer confidence.
Goldman Sachs analysts also raised their recession forecast, now predicting a 35% chance of a US recession, up from 20%. They expect Trump to announce reciprocal tariffs averaging 15% across all US trading partners on April 2.
Stock Market Struggles Amid Uncertainty
Tariff uncertainty has weighed heavily on US equities, contributing to a decline in stocks on Friday and marking a rough end to the last full trading week of March. Over the weekend, President Trump did little to alleviate concerns, pushing his advisors to adopt a more aggressive stance on tariffs, according to The Wall Street Journal.
In a Saturday interview with NBC News, Trump stated he “couldn’t care less” if foreign automakers raise their prices as a result of the new tariffs.
March Ending on a Low Note
As the month nears its end, all three major averages are set to finish lower. The S&P 500 is down 6.3% for March, while the Dow Jones Industrial Average is on track for a 5.2% loss. The Nasdaq Composite, dominated by technology stocks, has dropped 8.1%.
Economic Data to Watch
Looking ahead, traders will focus on key economic data this week, including the highly anticipated March jobs report set for release on Friday, April 4. This data, along with other reports on private payrolls and job openings, could provide insight into the broader economic impact of the ongoing trade tensions.
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