Dow Futures dropped early Friday after President Donald Trump announced a 35% tariff on all Canadian imports, effective August 1.
The Dow Jones Industrial Average futures slid 305 points, or about 0.7%, while the S&P 500 futures fell 0.6%, and the Nasdaq 100 futures also lost 0.6%, as Wall Street braced for what could be a fresh chapter in cross-border economic tensions.
Trump’s move marks a sharp escalation in the US-Canada trade relationship.
He cited “unfair” Canadian tariffs on US dairy products and accused Ottawa of turning a blind eye to fentanyl trafficking, allegations quickly dismissed by Canadian Prime Minister Mark Carney, who vowed to “defend Canadian jobs at any cost.”
The new tariff isn’t limited to a single industry either, it’s broad-based and appears to be part of a bigger effort to renegotiate terms with several US trade partners.
Trump also warned that any retaliatory action from Canada would be met with even steeper tariffs.
The rhetoric has set the stage for what could be a lengthy standoff between Washington and Ottawa, just as markets were hoping for a period of calm.
5 Things to know before Wall Street opens
1. Bitcoin shattered another all-time high, surging past $117,000 as investors piled into crypto ahead of next week’s much-anticipated “Crypto Week” in Congress.
Lawmakers are expected to debate sweeping legislation that could redefine the future of digital assets in the US.
The rally suggests a renewed appetite for risk, even as traditional assets wobble under the weight of trade tensions and broader geopolitical uncertainty.
2. Markets in Asia and Europe traded lower Friday as investors reacted to the fresh US tariff announcement.
Japan’s Nikkei and South Korea’s Kospi slipped into the red, while European indexes like the FTSE 100 and Germany’s DAX also felt the heat.
3. The US Treasury successfully auctioned off $39 billion in 10-year notes this week, with yields holding around 4.345%.
That came even as Fed minutes released Wednesday showed division among central bank officials over the timing of future rate cuts.
The bond market’s relative calm despite lingering concerns over the economy and renewed tariff tensions signals that investors are still carefully assessing how future Fed decisions could play out.
4. Delta kicked off earnings season with a strong beat, posting second-quarter results that exceeded forecasts.
The upbeat report gave a lift to the broader travel and airline sector, offering a rare dose of optimism amid an otherwise shaky week.
5. Technically, the charts still look strong. The S&P 500 and Nasdaq both closed at fresh highs, powered by relentless gains in tech with Nvidia briefly topping a $4 trillion market cap.
The Dow is up too, now just 1.4% shy of its all-time high. Still, some traders are urging caution as valuations stretch and volatility returns.
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