The U.S. stock market saw declines on Tuesday, following Treasury Secretary Scott Bescent’s confirmation that trade discussions with China have yet to commence. President Trump later remarked that the U.S. “doesn’t have to sign” a trade agreement.
The Dow Jones industrial average dropped by 389 points, or 1%, while the S&P 500 and NASDAQ saw decreases of 0.8% and 0.9%, respectively.
Bescent’s statements seemed to clash with Trump’s repeated assertions over recent weeks that discussions were ongoing, including a claim that Chinese President Xi Jinping had been in contact with him.
However, at noon, major stock indexes perked up a bit when Bescent indicated that the U.S. had received several “good offers” from various countries concerning trade arrangements.
During testimony before the House Subcommittee on Financial Services, Bescent mentioned that if the U.S. doesn’t secure 80% or 90% of its deals with major trading partners by year’s end, it would be quite surprising.
He added, “While it might be earlier, I think announcements regarding trade deals with some key partners could happen as soon as this week.”
Despite this, Trump further pushed down market shares during a crucial meeting with Canadian Prime Minister Mark Carney.
Trump stated, “We don’t have to sign a deal; they [foreign nations] must sign the transaction. They want a piece of our market, but we aren’t looking to take theirs.”
This suggests that Trump is not rushing to reduce tariffs. He mentioned that if the U.S. still has high tariffs on imports a year from now, he would view that as a “complete victory.”
Unlike past meetings, including a contentious encounter with Ukrainian President Volodymyr Zelensky, Trump described the meeting with Carney as “friendly.”
In response to Trump’s apparent desire to absorb Canada as the 51st state, the newly elected Canadian Prime Minister robustly asserted, “It’s not for sale.”
Trump quickly retorted, “Never say that.”
Ted Jenkin, president of Exit Stage Left Advisors, commented, “The market is experiencing daily fluctuations driven by tariffs, conflicts in leadership, and potential military confrontations.” He believes this uncertainty contributes to the ongoing market volatility.
Throughout the day, market unrest persisted as new trade data and guidance suspensions from several major firms failed to alleviate investor concerns.
Recent data from the Bureau of Economic Analysis revealed that the U.S. trade deficit surged to a record $1.4 trillion in March, marking a 92.6% increase this year as companies rushed to import goods ahead of Trump’s tariffs.
In March alone, imports rose by $17.8 billion compared to the previous month, while exports only saw a slight uptick of $500 million.
Additionally, Ford and Mattel have joined the list of companies retracting their annual forecasts amidst rising economic uncertainties.
Ford projected that tariffs would cost them around $1.5 billion, while Mattel indicated a potential loss of $270 million.
Jenkins noted, “When numerous companies struggle to provide guidance on future revenues, it raises doubt about whether the overall stock market is a safe investment.”
