U.S. stocks experienced a shaky performance in early trading on Wednesday, driven by an escalating global trade war and concerns over a possible recession. After modest initial gains, the Dow Jones Industrial Average dropped by 330 points, or 0.8%, while the S&P 500 fell 0.25%. Conversely, the tech-heavy Nasdaq increased by 0.25%.
Minutes after trading opened, a fresh inflation report indicated that price increases had eased more than expected in February, marking the first full month under President Donald Trump. However, tit-for-tat tariffs continued to unsettle global trade early Wednesday. Trump’s 25% tariffs on all imported steel and aluminum products took effect overnight. In retaliation, Canada and the European Union imposed duties on U.S. goods.
Tesla, led by Elon Musk, surged about 6% in early trading following an event at the White House where Trump praised the company alongside Musk.
Some economists argue that while U.S. tariffs might boost the local steel industry, they could also lead to higher prices for steel-buying industries, potentially affecting consumers. The U.S., heavily reliant on imported aluminum, is also expected to see rising costs.
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