Trade Wars: Wall Street Falls After Trump's New Tariffs

The U.S. stock market closed lower after Donald Trump announced new tariffs on imported cars. Despite strong economic data, the S&P 500 lost 0.3%, the Dow Jones dropped 0.4%, and the Nasdaq fell 0.5%.

Automakers were among the biggest losers. General Motors shares plunged 7.4%, while Ford fell 3.9%. Even U.S.-based car manufacturers felt the impact due to their complex supply chains across North America. Foreign automakers also suffered, with Hyundai in Seoul dropping 4.3%, Honda in Tokyo down 2.5%, and Toyota losing 2%.

However, electric vehicle companies showed resilience. Rivian surged 7.6%, and Tesla gained 0.4% as their U.S.-based production shields them from the worst effects of the tariffs. Meanwhile, auto service companies benefited from expectations that fewer people will buy new cars. AutoZone shares climbed 4%, O’Reilly Automotive rose 3.1%, and CarMax added 2.5%.

Markets remain tense ahead of April 2, dubbed "Liberation Day" by Trump, when he plans to impose reciprocal tariffs on U.S. trading partners. Investors hope for milder measures, but the uncertainty is already impacting consumer and business confidence.

Despite these risks, the U.S. economy remains stable. Jobless claims came in lower than expected, and GDP growth for the last quarter was revised upward, signaling continued economic strength.