US markets open with Dow falling 222 points as Trump slaps 35% tariff on Canada, signals wider trade war
US stocks fell sharply on Friday, 11 July 2025, as President Donald Trump’s aggressive tariff policies — a 35 percent tariff on Canadian imports effective 1 August and threats of 15 to 20 percent blanket tariffs on most trading partners, up from the current 10 percent — stoked fears of inflation and trade disruptions.
The Dow Jones Industrial Average dropped 222 points, or 0.5 percent, to 44,351, the S&P 500 slid 0.4 percent to 6,247, and the Nasdaq Composite dipped 0.3 percent to 20,450, retreating from Thursday’s record highs propelled by Nvidia’s $4 trillion valuation milestone.
The sell-off hit technology and financial stocks hardest, with Nvidia falling 1.2 percent and JPMorgan declining 1.1 percent, leading losses amongst banks. Trump’s tariff moves, including a 50 percent levy on copper and Brazilian imports, overshadowed Thursday’s gains, when the S&P 500 rose 0.3 percent and the Nasdaq advanced 0.1 percent.
Trump remained defiant, telling NBC News, “I think the tariffs have been very well-received. The stock market hit a new high today,” referencing Thursday’s rally. However, Friday’s mood darkened as investors awaited a potential European Union trade update, uncertain whether Trump would unveil new tariffs or signal progress in ongoing talks.
Drew Pettit, Citi’s US equity strategy director, warned on CNBC’s “Closing Bell Overtime” Thursday, “Structurally, we’re not there yet. Fundamentally, I don’t think we’re there yet. If you want these types of sectors to continue to outperform more than just a tactical trade, you’re going to need the macro data to hold in there and the Fed to cut rates.” His caution reflected concerns as Bank of America forecasted core PCE inflation could hit 3.6 percent by Q4 2025, surpassing the Federal Reserve’s 2 percent target, driven by tariff pressures.
David Bahnsen, chief investment officer at the Bahnsen Group, captured the market’s jitters, stating, “The market volatility is much less about the bad news of tariffs and much more about the uncertainty of tariffs.” Meanwhile, Bitcoin soared past $118,000, fuelled by $1.18 billion in ETF inflows, highlighting strong risk appetite in cryptocurrency markets despite the broader sell-off.
Investors are bracing for a pivotal week with Q2 earnings season kicking off, led by Delta Air Lines, and the release of the PCE price index, which could shape Federal Reserve policy. Fed Chair Jerome Powell’s cautious stance on rate cuts, citing tariff-driven inflation risks, suggests heightened volatility ahead.
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