The three major U.S. stock market indexes opened in the red Friday morning in the wake of President Donald Trump’s steel tariff announcement and his assertion that “trade wars are good.”
The Dow Jones Industrial Average was down over 300 points, the NASDAQ roughly 70 points and the S&P 500 in excess of 25 points Friday morning. The Dow and S&P 500 are down more than three percent on the week.
Trump’s administration announced Thursday that his administration is planning on imposing a 25 percent tariff on steel imports and a 10 percent tariff on aluminum imports. The administration will roll out more details in the coming week.
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The president asserted Friday morning that entering into trade wars is a net-positive for the American people and that it should not be difficult to win.
When a country (USA) is losing many billions of dollars on trade with virtually every country it does business with, trade wars are good, and easy to win. Example, when we are down $100 billion with a certain country and they get cute, don’t trade anymore-we win big. It’s easy!
— Donald J. Trump (@realDonaldTrump) March 2, 2018
We must protect our country and our workers. Our steel industry is in bad shape. IF YOU DON’T HAVE STEEL, YOU DON’T HAVE A COUNTRY!
— Donald J. Trump (@realDonaldTrump) March 2, 2018
“When a country (USA) is losing many billions of dollars on trade with virtually every country it does business with, trade wars are good, and easy to win. Example, when we are down $100 billion with a certain country and they get cute, don’t trade anymore-we win big. It’s easy,” Trump tweeted.
Investors immediately reacted to the announcement Friday morning, seeking safer investments, like gold, which rose 1.5 percent Friday morning. Prices of 10-year U.S. treasuries fell Friday morning as yields rose.
The Chicago Board Options Exchange volatility index (VIX) rose 13 percent Friday morning, reaching its highest level since Feb. 13.
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