Auto stocks fall on pressure from U.S. tariffs
Auto stocks fell in the premarket Monday, as traders weighed how the latest U.S. tariffs could hurt the industry.
General Motors lost more than 6%, while Ford Motor shed 4%. Engine maker Cummins and supplier stock Aptiv were also lower.
— Fred Imbert
The pan-European Stoxx 600 index was 1.3% lower during early morning deals on Monday, as regional investors reacted to fresh tariff threats from U.S. President Donald Trump.
All sectors were trading in negative territory, with auto stocks sustaining heavy losses.
Markets in the region were reacting negatively to Trump’s decision over the weekend to slap 25% tariffs on imports from Mexico and Canada and a 10% levy on goods from China. Canada has retaliated with its own sanctions on U.S. imports, and Mexico has threatened to do the same.
When asked on Sunday about the prospect of tariffs on goods from the U.K. and European Union, Trump told the BBC that both were “out of line” but that the EU was worse. He said a deal could be “worked out” with the U.K., a country with whom the U.S. has a more balanced trade relationship, but stood firm that tariffs on the EU “will definitely happen.”
Read live updates on European markets here.
— Chloe Taylor
Volkswagens are seen in the employee parking lot at the Volkswagen automobile assembly plant on March 20, 2024 in Chattanooga, Tennessee.
Elijah Nouvelage | Getty Images News | Getty Images
Shares of auto giants fell sharply on Monday, after U.S. President Donald Trump imposed long-threatened tariffs on goods from Canada, Mexico and China, sparking concerns about the prospect of a global trade war.
He has suggested the European Union could be next to face tariffs.
Japanese auto giants Toyota and Nissan both fell more than 5% on Monday, while domestic rival Honda tumbled 7.2%. Shares of Japan-listed Mazda Motor Corp traded more than 7.5% lower, while Kia Motor Corp fell nearly 7%.
In Europe, shares of French car parts supplier Valeo and automaker Renault fell 8.3% and 4%, respectively, during early morning deals. Meanwhile, Germany’s BMW, Volkswagen and Porsche were all seen trading off by around 5%.
— Sam Meredith
The U.S. dollar advanced nearly 1% on Sunday night, continuing gains since President Donald Trump implemented tariffs over the weekend. The currency is trading near five-year highs.
— Pia Singh
Another part of the energy market swung higher following the U.S. tariffs on Mexico, Canada and China. RBOB Gasoline futures were last up 3.3% at $2.1275 per gallon. The move shows traders expect these levies to drive up energy costs in the near term.
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RBOB rises
Traders appeared to search for safety in early Sunday night trading after the U.S. hit key trade partners with hefty tariffs on goods.
Bitcoin dipped back below $100,000, losing 3.6% to trade at $97,554.24. Gold, a traditional safe-haven asset, ticked 0.3% higher to $2,842.60 per ounce.
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Bitcoin falls, gold rises
The U.S. tariffs on Mexican, Canadian and Chinese goods come about a week before the Super Bowl, perhaps the biggest U.S. sporting event of the year.
With these levies in place, Americans could see a substantial price hike when shopping certain staples consumed during the event, such as avocados, RSM U.S. chief economist Joe Brusuelas warned.
“Whether you make guacamole from scratch, as my grandmother Juanita liked to do, or buy pre-made spicy guacamole from [grocery store chain] Central Market in Austin, Tex., it’s going to cost more,” Brusuelas said.
“A seven-ounce package at Central Market, which currently costs $4.98, would jump to $6.22 if the 25% tariff were fully passed along to consumers like me,” he said. “Some producers and manufacturers may elect to absorb some of the cost of the tariffs, but at 25%, that cost is too big to completely absorb.”
— Fred Imbert, Jeff Cox
The U.S. on Saturday imposed levies on imports from Canada, Mexico and China. Here’s how those countries, and the European Union, reacted:
- Canada: Prime Minister Justin Trudeau slapped retaliatory tariffs of 25% on $155 billion worth of U.S. goods. “Like the American tariffs, our response will also be far-reaching and include everyday items such as American beer, wine and bourbon, fruits and fruit juices, including orange juice, along with vegetables, perfume, clothing and shoes,” Prime Minister Justin Trudeau said.
- Mexico: President Claudia Sheinbaum slammed the new levies, saying she instructed the country’s secretary of the economy to “implement the Plan B we have been working on, which includes tariff and non-tariff measures in defense of Mexico’s interests.”
- China: The country said it would file a lawsuit with the World Trade Organization. “The U.S.’s unilateral tariff hike seriously violates WTO rules, does nothing to resolve its own issues, and disrupts normal economic and trade cooperation between China and the U.S.,” the Chinese Ministry of Commerce said in a statement Sunday, according to an NBC translation.
- The European Union: A spokesperson for the EU said the bloc would “respond firmly” if President Donald Trump imposed tariffs on the region. “Across-the-board tariff measures raise business costs, harm workers and consumers. Tariffs create unnecessary economic disruption and drive inflation. They are hurtful to all sides,” the spokesperson said.
— Katrina Bishop
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WTI jumps
