The MSCI Asia Pacific Index dropped 0.5%, led by losses in South Korea. Contracts for the S&P 500 fell 0.3% while those for European stocks retreated 0.4%. Trump will maintain a minimum global tariff of 10%, while imports from countries with trade surpluses with the US face duties of 15% or higher, the White House announced Thursday. The dollar was little changed Friday after posting its best month of the year in July.
The Swiss franc edged lower while the Canadian dollar was steady. Thai baht held a small decline. Trump raised levies on Canada to 35% while Switzerland got a 39% rate.
The moves signaled that concerns over tariffs and economic growth were starting to outweigh the AI-driven optimism that has buoyed megacap tech stocks. While artificial intelligence remains a pillar of long-term bullishness, investors are bracing for potential trade disruptions as the US and key partners weigh new levies.
“The announcement brings clarity on paper, but uncertainty in practice,” said Charu Chanana, chief investment strategist at Saxo Markets. “While markets now know the numbers, the lack of a clear framework behind these tariffs — and the seemingly arbitrary rates — only reinforces the sense of policy unpredictability. This makes it harder for businesses and investors to plan ahead.”
The White House issued a statement just hours before midnight, the deadline Trump set last month after pausing his country-based tariffs for a second time to allow for negotiations. It was unclear exactly when the new rates would take effect.
Some of the tariffs were expected, such as a 25% levy on Indian exports. Others included charges of 20% on Taiwanese products, 39% on Swiss goods and 30% on South African products. Thailand and Cambodia, two countries that were said to have struck a last-minute deal, received a 19% duty.US stocks fell Thursday, erasing an initial advance on tech earnings that sent Microsoft Corp. above $4 trillion in market value. Apple Inc. shares rose in after-market trading following a sales beat, while those for Amazon.com Inc. fell as its outlook underwhelmed.Meanwhile, Trump sent letters to 17 of the largest pharmaceutical companies in a bid to lower prices, weakening their shares Thursday. Trump is also asking bank chief executive officers for their pitches on monetizing mortgage giants Fannie Mae and Freddie Mac, including a major public offering of stock, according to people familiar with the matter.
The market’s attention will soon turn to Friday’s jobs report for July, which is forecast to show companies are becoming more deliberate in their hiring. Employment likely moderated after a June increase, while the unemployment rate is seen ticking up to 4.2%.
In the run-up, the Fed’s preferred measure of underlying inflation accelerated in June to one of the fastest paces this year while consumer spending barely rose, underscoring the dueling forces dividing policymakers over the path of rates.
The core personal consumption expenditures price index rose 0.3% from May. It advanced 2.8% on an annual basis, a pickup from June 2024 that underscores limited progress on taming inflation in the past year. The data also showed inflation-adjusted consumer spending edged up last month.
“Inflation remains sticky and justifies the Fed’s decision to keep rates unchanged at Wednesday’s meeting,” said Clark Bellin at Bellwether Wealth.
