Top Line
US stock futures have surged following President Donald Trump’s announcement that his administration would begin sending letters to trading partners regarding unilateral tariff rates.
Important facts
All major US futures indexes dropped significantly early Friday, with the S&P 500 futures leading the decline, down about 0.6%, which translates to a loss of 6,288 points.
Dow futures decreased by 0.5%, landing at 44,865 points, while tech-focused Nasdaq futures fell 0.56% to 22,932.25 points.
The US market is closed on Friday, which is Independence Day.
In Europe, stocks seemed to react negatively to the tariff news as the Pan-European Stoxx 50 index fell by 0.7%, and the FTSE 100 index in London dropped 0.3%.
What did Trump say about setting up a customs letter?
During a press briefing on Thursday, Trump indicated that his administration plans to initiate sending letters on Friday to inform trading partners about the impending tariff rates starting next month. Trump mentioned that around “10 or 12” letters would likely go out Friday, with additional letters expected in the following days. Ideally, he aims to have all unresolved customs letters dispatched by July 9, which aligns with the deadline set during previous trade negotiations regarding his “liberation date” tariffs. However, he did not specify which countries would receive these letters.
What did Trump say about unilateral tariffs in the past?
Last month, Trump stated that the US is negotiating trade agreements with about 15 countries, although the country has “150+” trading partners in total. He commented on sending letters, suggesting that at a certain juncture, it might be a simple “take it or leave it” situation. He anticipated the letters would go out in approximately a week and a half to two weeks.
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As Trump suggests, “Take it or leave it,” our futures indicate customs deals will be forthcoming in two weeks.
