Reuters
10 min read
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LONDON/NEW YORK (Reuters) - U.S. President Donald Trump cranked up his trade threats on Friday, targeting both smartphone giant Apple along with imports from the European Union, roiling global markets.
Trump threatened to impose a 25% tariff on Apple for any iPhones sold, but not manufactured, in the United States. He also said he would recommend a 50% tariff on the European Union to begin on June 1.
Stock indexes in the U.S. and across Europe fell, although they pared earlier sharper losses. The U.S. benchmark S&P 500 was down about 0.8% and the pan-European STOXX 600 index was last down 1%.
COMMENTS:
PHIL BLANCATO, CHIEF MARKET STRATEGIST, OSAIC, NEW JERSEY
“Trump announced the possibility of two tariffs, one on the European Union of 50% that could possibly be enacted on June 1st, and one on Apple of 25% that did not come with a potential timeline. Both tariff announcements are seen as a way to bring the respective entities to the bargaining table, as Apple recently announced shifting iPhone production to India as opposed to the U.S., and the EU has not made any notable concessions in trade negotiations."
“Trump's renewed trade threats against Apple and the EU disrupt the period of relative calm in global trade tensions, raising risks for tech and multinational firms ahead of low-liquidity holiday weekend in the United States. With the bond market closing early, the timing heightens the potential for outsized market reactions as investors reassess geopolitical risks and brace for possible European retaliatory measures.”
STEVE SOSNICK, CHIEF STRATEGIST, INTERACTIVE BROKERS, GREENWICH, CONNECTICUT
"President Trump’s double whammy of threats against (Apple) and the EU was an unexpected blast to global markets. Opening more fronts on the trade war were exactly what traders hoping for a quiet end to a pre-holiday weekend did not need, and it clearly caught most off guard. I’m sure that plans of many in the US to try to leave work early were dashed. It’s not clear what prompted these statements, but they are emblematic of the type of volatility that we should always be prepared for."
JAMIE COX, MANAGING PARTNER, HARRIS FINANCIAL GROUP, RICHMOND, VIRGINIA
"These latest, ultra specific tariffs are clearly negotiating leverage tactics. You can tell which trade deals are being negotiated and need an extra nudge to make progress."
"Markets go through a cycle with tariffs - freak out and sell when they are announced, freak out and buy when they are paused. It’s crazy, but that’s the pattern."
