U.S. stock futures weakened on Sunday evening after President Donald Trump confirmed that import tariffs would take effect on August 1st, rather than July 9th, as previously expected by the markets.
Major indexes posted losses:
- The Dow Jones fell by 146 points (-0.32%)
- The S&P 500 declined by 0.39%
- The Nasdaq 100 dropped by 0.42%
The announcement came during a joint statement with Commerce Secretary Howard Lutnick, who clarified that while tariffs are set to begin on August 1st, the specific rates and agreements are still being formulated.
Previously, Treasury Secretary Scott Bessent noted that tariffs would revert to their April 2nd levels if no progress was made on a trade deal. Meanwhile, the executive order from April 9th that set July 9th as the tariff deadline has not been officially rescinded, creating further market uncertainty.
Initially, investors had anticipated that tariffs would be implemented this week. However, a recent statement from the White House deeming the July deadline as “non-crucial” brought some short-term relief to the market.
U.S. equities had just wrapped up a strong week, with the S&P 500 and Nasdaq reaching all-time highs. The rally was largely driven by expectations that the Trump administration would refrain from enacting the harshest tariff measures.
Despite the uncertainty surrounding trade policy, several analysts remain optimistic, anticipating that the upcoming earnings season could show companies weathering tariff pressures and potentially delivering upside surprises.
Morgan Stanley analysts noted that trade negotiations tend to be prolonged affairs. Even though the current process is narrower than a full free trade agreement, historical precedents remain relevant as a guide.