Category: Business

(NEW YORK) — The stock market surged on Wednesday afternoon after the Trump administration granted automakers a one-month exemption from tariffs imposed a day earlier.

The Dow Jones Industrial Average climbed about 550 points, or 1.3%; while the S&P 500 jumped 1.25%. The tech-heavy Nasdaq increased 1.5% on Wednesday.

Press Secretary Karoline Leavitt said President Donald Trump had ordered the delay of auto tariffs after a request from the Big 3 U.S. automakers: Ford, General Motors and Stellantis, the parent company of Jeep and Chrysler.

“The president is giving them an exemption for one month so they’re not at an economic disadvantage,” Leavitt said during a press conference at the White House.

The tariffs are expected to pose a challenge for U.S. automakers, many of which depend on a supply chain closely intertwined with Mexico and Canada.

While easing some tariffs, Trump criticized Canada on Wednesday for what he described as failure to take the steps necessary for the United States to withdraw all of the tariffs imposed a day earlier.

Trump said he held a call with Canadian Prime Minister Justin Trudeau on Wednesday during which the two leaders discussed a path to U.S. withdrawal of the tariffs, Trump said, noting such an outcome would require sufficient action by Canada to address drug trafficking.

A week ago, Trump alleged that illicit drugs such as fentanyl had continued to enter the U.S. through Mexico and Canada despite agreements reached last month to address the issue.

In a post on Truth Social on Wednesday, Trump said, “nothing has convinced me” that the flow of fentanyl into the U.S. had stopped.

“[Trudeau] said that it’s gotten better, but I said, ‘That’s not good enough.’ The call ended in a ‘somewhat’ friendly manner!” Trump said.

Since September, nearly all fentanyl seized by the U.S. came through the Southern border with Mexico, according to the U.S. Customs and Border Patrol, or CBP, a federal agency. Less than 1% of fentanyl was seized at the Northern border with Canada, CBP found.

Canadian Prime Minister Justin Trudeau sharply criticized the tariffs on Tuesday, calling them a “dumb” policy that does not “make sense.”

The reason for the tariffs is based on a false allegation about Canada as a major source of drugs entering the U.S., Trudeau added.

Persistent tensions between the U.S. and Canada emerged after China issued a warning on Tuesday night that it stands ready for any “type of war” with the United States in the aftermath of tariffs imposed by the Trump administration.

The U.S. slapped 25% tariffs on goods from Mexico and Canada, as well as 10% tariffs on imports from China. The fresh round of duties on Chinese goods doubled an initial set of tariffs placed on China last month.

A spokesperson for the Chinese foreign ministry said the tariffs would not lead to a resolution of U.S. concerns about fentanyl originating in China.

“If the U.S. truly wants to solve the fentanyl issue, then the right thing to do is to consult with China on the basis of equality, mutual respect and mutual benefit to address each other’s concerns,” Chinese spokesperson Lin Jian said at a press conference late Tuesday.

“If the U.S. has other agenda in mind and if war is what the U.S. wants, be it a tariff war, a trade war or any other type of war, we’re ready to fight till the end,” the spokesperson added.

The comments came soon after the Trump administration imposed 25% tariffs on goods from Mexico and Canada, as well as 10% tariffs on imports from China. The fresh round of duties on Chinese goods doubled an initial set of tariffs placed on China last month.

Within minutes of the new U.S. tariffs taking effect, China unveiled on Tuesday its initial response by placing additional 10% to 15% tariffs on imported U.S. goods, like chicken, wheat, soybeans and beef.

“The retaliatory tariffs that China is imposing is very specific and directly targeted at American farmers, who are mostly in red states and mostly voted for Trump,” Neil Thomas, a fellow for Chinese politics at the Asia Society Policy Institute’s Center for China Analysis, told ABC News.

“So China is trying to create pain where it matters for Trump, and it’s hoping to get Trump to the negotiating table and offer relief for this group of Trump supporters,” Thomas added.

The recent duties will be placed on top of similar tariffs imposed by China during the first Trump administration’s trade war in 2018. Some of those tariffs are already at 25%, though Beijing issued some waivers as a result of the 2020 “phase one” trade deal.

The new Chinese tariffs are set to come into effect for goods shipped out March 10.

In a series of social media posts last month, Trump said he would place tariffs on Canada, Mexico and China for hosting the manufacture and transport of illicit drugs that end up in the U.S.

During an address to a joint session of Congress on Tuesday night, Trump also sharply criticized tariffs imposed by the Chinese government on U.S. goods.

“President Trump continues to demonstrate his commitment to ensuring U.S. trade policy serves the national interest,” the White House said in a statement on Tuesday.

Commerce Secretary Howard Lutnick said on Tuesday afternoon that Trump may soon offer Canada and Mexico a pathway to relief from tariffs placed on some goods covered by North America’s free trade agreement.

Lutnick did not mention a potential compromise with China.

ABC News’ Selina Wang, Kevin Shalvey, Karson Yiu and Ellie Kaufman contributed to this report.

Copyright © 2025, ABC Audio. All rights reserved.

(NEW YORK) — President Donald Trump criticized Canada on Wednesday for what he described as failure to take the steps necessary for the United States to withdraw tariffs imposed a day earlier.

Trump said he held a call with Canadian Prime Minister Justin Trudeau on Wednesday during which the two leaders discussed a path to U.S. withdrawal of the tariffs, Trump said, noting such an outcome would require sufficient action by Canada to address drug trafficking.

A week ago, Trump alleged that illicit drugs such as fentanyl had continued to enter the U.S. through Mexico and Canada despite agreements reached last month to address the issue.

In a post on Truth Social on Wednesday, Trump said, “nothing has convinced me” that the flow of fentanyl into the U.S. had stopped.

“[Trudeau] said that it’s gotten better, but I said, ‘That’s not good enough.’ The call ended in a ‘somewhat’ friendly manner!” Trump said.

Since September, nearly all fentanyl seized by the U.S. came through the Southern border with Mexico, according to the U.S. Customs and Border Patrol, or CBP, a federal agency. Less than 1% of fentanyl was seized at the Northern border with Canada, CBP found.

Canadian Prime Minister Justin Trudeau sharply criticized the tariffs on Tuesday, calling them a “dumb” policy that does not “make sense.”

The reason for the tariffs is based on a false allegation about Canada as a major source of drugs entering the U.S., Trudeau added.

Persistent tensions between the U.S. and Canada emerged after China issued a warning on Tuesday night that it stands ready for any “type of war” with the United States in the aftermath of tariffs imposed by the Trump administration.

The U.S. slapped 25% tariffs on goods from Mexico and Canada, as well as 10% tariffs on imports from China. The fresh round of duties on Chinese goods doubled an initial set of tariffs placed on China last month.

A spokesperson for the Chinese foreign ministry said the tariffs would not lead to a resolution of U.S. concerns about fentanyl originating in China.

“If the U.S. truly wants to solve the fentanyl issue, then the right thing to do is to consult with China on the basis of equality, mutual respect and mutual benefit to address each other’s concerns,” Chinese spokesperson Lin Jian said at a press conference late Tuesday.

“If the U.S. has other agenda in mind and if war is what the U.S. wants, be it a tariff war, a trade war or any other type of war, we’re ready to fight till the end,” the spokesperson added.

The comments came soon after the Trump administration imposed 25% tariffs on goods from Mexico and Canada, as well as 10% tariffs on imports from China. The fresh round of duties on Chinese goods doubled an initial set of tariffs placed on China last month.

Within minutes of the new U.S. tariffs taking effect, China unveiled on Tuesday its initial response by placing additional 10% to 15% tariffs on imported U.S. goods, like chicken, wheat, soybeans and beef.

“The retaliatory tariffs that China is imposing is very specific and directly targeted at American farmers, who are mostly in red states and mostly voted for Trump,” Neil Thomas, a fellow for Chinese politics at the Asia Society Policy Institute’s Center for China Analysis, told ABC News.

“So China is trying to create pain where it matters for Trump, and it’s hoping to get Trump to the negotiating table and offer relief for this group of Trump supporters,” Thomas added.

The recent duties will be placed on top of similar tariffs imposed by China during the first Trump administration’s trade war in 2018. Some of those tariffs are already at 25%, though Beijing issued some waivers as a result of the 2020 “phase one” trade deal.

The new Chinese tariffs are set to come into effect for goods shipped out March 10.

In a series of social media posts last month, Trump said he would place tariffs on Canada, Mexico and China for hosting the manufacture and transport of illicit drugs that end up in the U.S.

During an address to a joint session of Congress on Tuesday night, Trump also sharply criticized tariffs imposed by the Chinese government on U.S. goods.

“President Trump continues to demonstrate his commitment to ensuring U.S. trade policy serves the national interest,” the White House said in a statement on Tuesday.

Commerce Secretary Howard Lutnick said on Tuesday afternoon that Trump may soon offer Canada and Mexico a pathway to relief from tariffs placed on some goods covered by North America’s free trade agreement.

Lutnick did not mention a potential compromise with China.

ABC News’ Selina Wang, Kevin Shalvey, Karson Yiu and Ellie Kaufman contributed to this report.

Copyright © 2025, ABC Audio. All rights reserved.

(NEW YORK) — Price hikes for gasoline and groceries could reach shoppers within days in the aftermath of tariffs imposed by the Trump administration, experts told ABC News.

Some products such as auto fuel and fresh produce will be hit with near-instant price increases, while others like cars, laptops and children’s toys will show hikes in the coming weeks and months, they said.

The Trump administration imposed 25% tariffs on goods from Mexico and Canada, as well as 10% tariffs on imports from China. The fresh round of duties on Chinese goods doubled an initial set of tariffs placed on China last month.

Mexico, Canada and China make up the three largest U.S. trading partners, accounting for a vast array of products ranging from everyday essentials to big-ticket purchases.

Tariffs of this magnitude would likely increase prices paid by U.S. shoppers, since importers typically pass along a share of the cost of those higher taxes to consumers, experts said.

“Higher tariffs will translate into higher prices for some products very quickly,” Mark Zandi, chief economist at Moody’s Analytics, told ABC News. “It will take longer for everything from vehicles to appliances to consumer electronics.”

In a series of social media posts last month, Trump said he would place tariffs on Canada, Mexico and China for hosting the manufacture and transport of illicit drugs that end up in the U.S.

During an address to a joint session of Congress on Tuesday night, Trump also sharply criticized tariffs imposed on U.S. goods by Canada, Mexico and China.

“President Trump continues to demonstrate his commitment to ensuring U.S. trade policy serves the national interest,” the White House said in a statement on Tuesday.

The U.S. imported $38.5 billion in agricultural goods from Mexico in 2023, making it the top recipient of such products, U.S Department of Agriculture data showed. Those imports include more than $3 billion worth of fresh fruits and vegetables.

Roughly 90% of avocados eaten in the U.S. last year originated in Mexico, USDA data showed. Other products with a high concentration of Mexican imports include tomatoes, cucumbers, bell peppers, jalapeños, limes and mangos.

These products will show price increases within days because fresh produce cannot be held on shelves for an extended period, meaning imports slapped with tariffs will soon reach shoppers, Jason Miller, a professor of supply chain management at Michigan State University, told ABC News.

“That’s what you’d expect to be hit the fastest,” Miller said.

A similar dynamic will play out for gasoline prices for some U.S. drivers living in regions that rely on crude oil from Mexico and Canada, said Timothy Fitzgerald, a professor of business economics at the University of Tennessee who studies the petroleum industry.

Mexico and Canada account for 70% of U.S. crude oil imports, which make up a key input for the nation’s gasoline supply, according to the U.S. Energy Information Administration, a government agency.

Those imports come primarily from Canada, which sends crude oil to U.S. refineries built specifically to process the crude and redistribute it as gasoline for cars and trucks. Gasoline that originates as Canadian crude reaches customers in the upper Midwest as well as some along the East and West coasts, Fitzgerald said.

Gas refiners and retailers retain the ability to alter prices multiple times per day, meaning price hikes may have hit some drivers as early as Tuesday, he added.

“Think about a digital board at a gas station – a couple taps to a button and the price goes up,” Fitzgerald said.

A second wave of price increases will hit a wide-ranging set of products over the coming weeks and months, some experts said.

A large share of consumer electronics – such as laptops, video game systems and smartphones – enter the U.S. from China, meaning the new tariffs will filter through into higher prices for those goods, they said.

Price hikes will ultimately hit children’s toys, since many of those products also originate in China, Miller said.

Some U.S. retailers appear to have been stockpiling children’s toys in anticipation of the tariffs, but the stored items will run out soon, he added.

“You probably don’t get much of a reprieve beyond April,” Miller said.

Prices for Mexico-made beer and tequila will also rise over the coming months, as will the cost of Canada-made maple syrup, Miller added.

Canada is the top source of imported U.S. eggs, adding stress to a supply chain already decimated by an avian flu outbreak.

Egg prices skyrocketed 53% over the past year, U.S. Bureau of Labor Statistics data showed last month.

Since the U.S. relies overwhelmingly on domestic egg production, however, a potential price increase for Canadian eggs is not expected to meaningfully drive up egg prices at U.S. stores, Miller said.

“But it certainly doesn’t make things better,” Miller added.

ABC News’ Jacob Eufemia contributed to this report.

Copyright © 2025, ABC Audio. All rights reserved.

(NEW YORK) — China issued a warning on Wednesday night that it stands ready for any “type of war” with the United States in the aftermath of tariffs imposed hours earlier by the Trump administration.

A spokesperson for the Chinese foreign ministry said the tariffs would not lead to a resolution of U.S. concerns about fentanyl originating in China.

“If the U.S. truly wants to solve the fentanyl issue, then the right thing to do is to consult with China on the basis of equality, mutual respect and mutual benefit to address each other’s concerns,” Chinese spokesperson Lin Jian said at a press conference late Tuesday.

“If the U.S. has other agenda in mind and if war is what the U.S. wants, be it a tariff war, a trade war or any other type of war, we’re ready to fight till the end,” Jian added.

The remarks came soon after the Trump administration imposed 25% tariffs on goods from Mexico and Canada, as well as 10% tariffs on imports from China. The fresh round of duties on Chinese goods doubled an initial set of tariffs placed on China last month.

Within minutes of the new U.S. tariffs taking effect, China unveiled on Tuesday its initial response by placing additional 10% to 15% tariffs on imported U.S. goods, like chicken, wheat, soybeans and beef.

Those duties will be on top of similar tariffs imposed back during the first Trump administration’s trade war in 2018. Some of those tariffs are already at 25%, though Beijing issued some waivers as a result of the 2020 “phase one” trade deal.

The new Chinese tariffs are set to come into effect for goods shipped out next Monday, March 10.

In a series of social media posts last month, Trump said he would place tariffs on Canada, Mexico and China for hosting the manufacture and transport of illicit drugs that end up in the U.S.

During an address to a joint session of Congress on Tuesday night, Trump also sharply criticized tariffs imposed by the Chinese government on U.S. goods.

“President Trump continues to demonstrate his commitment to ensuring U.S. trade policy serves the national interest,” the White House said in a statement on Tuesday.

Commerce Secretary Howard Lutnick said on Tuesday afternoon that Trump may soon offer Canada and Mexico a pathway to relief from tariffs placed on some goods covered by North America’s free trade agreement.

Lutnick did not mention a potential compromise with China.

Copyright © 2025, ABC Audio. All rights reserved.

(RIO GRANDE CITY, TEXAS) — Emily Williams Knight, president and CEO of the Texas Restaurant Association, represents 58,000 restaurants that employ 1.5 million Texans. That breaks down to 11% of the state’s workforce that could potentially be impacted by the 25% tariffs on Mexican imports that just went into effect.

All Tuesday morning she was on calls and in meetings, calming fears because people believe Texas will feel the brunt of this first — And, after that, the domino effect will be fast.

“Exhausted and afraid: Those are the words I keep hearing from people,” Williams Knight said. “They’re running out of levers to pull here, and they’re afraid. If this is a sustained tariff policy — what that will mean to their business long term? The unpredictability comes with a tremendous cost.”

One of those concerned businesses is Texas Cafe in Rio Grande City, which has been serving South Texas for more than 85 years and was recently certified as a historical landmark by the State of Texas. People travel from all over the country to try their signature dish, Envueltos: A special chile-con-carne filling rolled up in a tortilla. But don’t call it an enchilada or the owner, Becky Garza, will scold you profusely.

“These are my grandfather’s recipes that he invented back in 1939,” she said. “And when you change something, people notice. Especially Hispanic people.”

Garza is getting ready for Cuaresma, or 40 days of Lent. It is essential that she gets very specific ingredients from Mexico for this time of year or her customers will know something isn’t right. Plain and simple: Her business, livelihood and family legacy depend on imports from Mexico that play an essential role in the food she serves. And now, she said, all of that is going to cost more because of the new tariffs.

“I can buy stuff from Mexico cheap and use it in my home. But I can’t use any of those products from Mexico in my business unless I buy them from a store that follows FDA guidelines. I buy Mexican cokes. I get cinnamon sticks. These are a very high-price now and sometimes hard to find. I get pilonsios. Chile guajillo for menudo. And avocados from Mexico are better — the real avocados from Mexico that you can only find in small stores. But boy, they are expensive, and it’s only going to get worse,” Garza explained, adding: “I will not stop getting these items from Mexico, because I don’t want to change the consistency or the quality.”

Garza has seen prices steadily increasing over the last few years. In 2024, she spent around $1,000 for her specialty Cuaresma items. But in 2025, she spent $1,200 — a 20% increase that may not seem like a lot to big retail chains, but is huge for small business owners like Garza.

Knight wholeheartedly agrees, saying, “In the last four years we’ve seen a 35% increase in the cost of food needed in these restaurants and a 36% increase in labor. That’s not even including the big swipe fees businesses are paying, plus the increases to rent and utilities.”

Over the last 30 days, TRA has worked closely with the National Restaurant Association on a strategy to help mitigate the uncertainty. They’ve suggested restaurants review their menus and supply chain, looking for ways to source things closer to their businesses. They’ve also encouraged businesses to keep pushing the value of their service and products. And, before these tariffs went into effect, they reached out to lawmakers to educate them on the impact and push for exemptions.

“It feels like we are in this very unknown space again,” Williams Knight said.

Small, independent businesses make up 70% of the restaurants in Texas.

So, while both big and small establishments will be impacted, Williams Knight said she worries that this will create a ripple effect that could drive some families to close up shop.

She said that some of their restaurants are already starting to get emails from suppliers about costs going up, and she compared the feeling to a few days after the COVID-19 pandemic shutdown was announced, explaining: “You’re going to see a very large number of closures and then a large number of people unemployed.”

For years, as prices have gone up, Garza has found a way to cut back and save so she doesn’t have to charge customers more. In fact, she’s been working a second, primary job that sustains her own day-to-day needs, opting not to take a real paycheck from Texas Cafe. But she’s retiring in June and having to think about her future. And for the first time since she’s taken over the restaurant, Garza made the tough decision on Tuesday to raise prices.

“I had a meeting with my waitress and we’re going up on the breakfast menu due to the high price of eggs,” Garza explained. “I save money and I am frugal. But right now it’s been getting difficult.”

Not wanting to manifest any other difficulties the restaurant may face in the future, she said that’s all she’s willing to do and talk about for now.

However, there are indicators that the tariff policies that went into effect Tuesday may not affect small businesses as extremely as some are predicting, or their customers, for too long.

President Donald Trump’s administration could announce a pathway for tariff relief on Mexican and Canadian goods covered by the North America Free Trade Agreement as soon as Wednesday, according to an interview with Commerce Secretary Howard Lutnick on Fox Business on Tuesday.

ABC News’ Zunaira Zaki contributed to this report.

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(WASHINGTON) — America’s closest neighbors, Canada and Mexico, excoriated President Donald Trump for slapping historic tariffs on goods from their countries.

Trump’s broad tariffs went into effect on Tuesday, along with increased duties on goods from China, a move that prompted a swift retaliation from Beijing.

“President Trump continues to demonstrate his commitment to ensuring U.S. trade policy serves the national interest,” the White House said in a statement.

Goods entering the U.S. from Mexico and Canada will carry a 25% tariff, while those from China will be subject to a 10% increase on existing tariffs, according to the White House.

U.S. tariffs are at their highest level since 1943, Yale’s Budget Lab said.

On Feb. 27, Trump alleged that illicit drugs such as fentanyl had continued to enter the U.S. through Mexico and Canada despite agreements reached last month to address the issue.

Since September, nearly all fentanyl seized by the U.S. came through the Southern border with Mexico, according to the U.S. Customs and Border Patrol, or CBP, a federal agency. Less than 1% of fentanyl was seized at the Northern border with Canada, CBP found.

Canadian Prime Minister Justin Trudeau sharply criticized the tariffs, calling them a “dumb” policy that does not “make sense.”

The reason for the tariffs is based on a false allegation about Canada as a major source of drugs entering the U.S., Trudeau added.

“It’s an example of [Trump] not really being able to see what it is that he wants, because even the excuse that he’s giving for these tariffs today of fentanyl is completely bogus, completely unjustified [and] completely false,” Trudeau said.

In response, Canada slapped a 25% retaliatory tariff on $30 billion worth of goods. Tariffs on an additional $125 billion worth of products will take effect in 21 says, Trudeau said.

“We will not back down from a fight,” Trudeau added.

Meanwhile, Mexican President Claudia Sheinbaum announced plans to impose retaliatory tariffs on U.S. goods.

“There is no motive or reason, nor justification that supports this decision that will affect our people and our nations,” Sheinbaum said. “We have said it in different ways: cooperation and coordination, yes; subordination and interventionism, no.”

Sheinbaum said she will speak over the phone with Trump on Thursday, and if no deal can be reached, she’ll announce the tariff and non-tariff measures at a rally on Sunday.

China’s response

Within minutes of the new U.S. tariffs taking effect, China unveiled on Tuesday its initial response by placing additional 10% to 15% tariffs on imported U.S. goods, like chicken, wheat, soybeans and beef.

Those duties will be on top of similar tariffs imposed back during the first Trump administration’s trade war in 2018. Some of those tariffs are already at 25%, though Beijing issued some waivers as a result of the 2020 “phase one” trade deal.

The new Chinese tariffs are set to come into effect for goods shipped out next Monday, March 10.

Stock prices plummet

Stock futures for the three major U.S. indexes were close to flat early Tuesday following the selloff on Monday as Trump announced his proposed tariffs would go into effect at 12:01 a.m.

Stock prices plummet

Stock futures for the three major U.S. indexes were close to flat early Tuesday following the selloff on Monday as Trump announced his proposed tariffs would go into effect at 12:01 a.m.

Asian markets were mixed on Tuesday. The Shanghai Stock Exchange climbed less than a percentage point, while the Nikkei in Japan slipped about 1.2% and the Hang Seng in Hong Kong closed down about 0.3%.

European markets mostly traded off on Tuesday, with the DAX in Germany down about 1.6% and the FTSE 100 slipping about 0.3% midday.

The U.S. tariffs arrived about a month after Trump granted Mexico and Canada a reprieve, having reached agreements with the two countries regarding border security and drug trafficking.

ABC News’ Zunaira Zaki and Anne Laurent contributed to this report.

Copyright © 2025, ABC Audio. All rights reserved.

(NEW YORK) — The stock market fell in early trading on Tuesday, just hours after the Trump administration’s long-promised tariffs took effect.

The Dow Jones Industrial Average dropped nearly 800 points, or 1.8%; while the S&P 500 also fell 1.8%. The tech-heavy Nasdaq tumbled 1.6%.

The policy taxes imports from Mexico, Canada and China — the three largest trading partners of the United States — meaning that it could raise prices for everything from gasoline to avocados to iPhones.

Shares of retail giant Target fell 4.5% in early trading on Tuesday, following an earnings release from the company that cited “tariff uncertainty” as a potential impediment for the business. Walmart’s stock price dipped 1% on Tuesday, while Amazon shares fell 2%.

Shares of Best Buy plummeted more than 13% on Tuesday morning. The sharp drop came hours after Best Buy CEO told analysts that price increases are “highly likely” as a result of the tariffs.

Higher costs for car production could also pose a challenge for U.S. automakers, many of which depend on a supply chain closely intertwined with Mexico and Canada.

Shares of Ford tumbled 3% on Tuesday, while General Motors dropped more than 4%. Stellantis — the parent company of Jeep and Chrysler — saw shares plummet more than 7%.

Tesla, the electric carmaker led by Elon Musk, saw its stock price drop nearly 7%.

The far-reaching losses extend a market slide that began on Monday afternoon when Trump affirmed plans to impose a fresh round of tariffs.

Trump stuck to a March 4 start date for 25% tariffs on imports from Mexico and Canada, as well as 10% tariff on Chinese goods — which, as of Tuesday, rises to 20%, per an amended executive order.

Tariffs of this magnitude would likely increase prices paid by U.S. shoppers, since importers typically pass along a share of the cost of those higher taxes to consumers, experts said. The duties also raise input costs for manufacturers that import raw materials.

In addition to Tesla and Amazon, the tariffs appeared to impact some of the other so-called “Magnificent Seven,” a group of large tech firms that helped drive stock market gains in recent years.

Chipmaker Nvidia, which relies on semiconductors from Taiwan but also imports some materials from Mexico, saw shares drop more than 2%.

Meta, the parent company of Facebook and Instagram, suffered a 4% drop in its stock price. Microsoft’s stock fell 1%.

Shares of Alphabet and Google defied the trend, however, remaining essentially unchanged in early trading on Tuesday.

This is a developing story. Please check back for updates.

Copyright © 2025, ABC Audio. All rights reserved.

(NEW YORK) — The stock market fell in early trading on Tuesday, just hours after the Trump administration’s long-promised tariffs took effect.

The Dow Jones Industrial Average dropped nearly 800 points, or 1.8%; while the S&P 500 also fell 1.8%. The tech-heavy Nasdaq tumbled 1.6%.

The policy taxes imports from Mexico, Canada and China — the three largest trading partners of the United States — meaning that it could raise prices for everything from gasoline to avocados to iPhones.

Shares of retail giant Target fell 4.5% in early trading on Tuesday, following an earnings release from the company that cited “tariff uncertainty” as a potential impediment for the business. Walmart’s stock price dipped 1% on Tuesday, while Amazon shares fell 2%.

Shares of Best Buy plummeted more than 13% on Tuesday morning. The sharp drop came hours after Best Buy CEO told analysts that price increases are “highly likely” as a result of the tariffs.

Higher costs for car production could also pose a challenge for U.S. automakers, many of which depend on a supply chain closely intertwined with Mexico and Canada.

Shares of Ford tumbled 3% on Tuesday, while General Motors dropped more than 4%. Stellantis — the parent company of Jeep and Chrysler — saw shares plummet more than 7%.

Tesla, the electric carmaker led by Elon Musk, saw its stock price drop nearly 7%.

The far-reaching losses extend a market slide that began on Monday afternoon when Trump affirmed plans to impose a fresh round of tariffs.

Trump stuck to a March 4 start date for 25% tariffs on imports from Mexico and Canada, as well as 10% tariff on Chinese goods — which, as of Tuesday, rises to 20%, per an amended executive order.

Tariffs of this magnitude would likely increase prices paid by U.S. shoppers, since importers typically pass along a share of the cost of those higher taxes to consumers, experts said. The duties also raise input costs for manufacturers that import raw materials.

In addition to Tesla and Amazon, the tariffs appeared to impact some of the other so-called “Magnificent Seven,” a group of large tech firms that helped drive stock market gains in recent years.

Chipmaker Nvidia, which relies on semiconductors from Taiwan but also imports some materials from Mexico, saw shares drop more than 2%.

Meta, the parent company of Facebook and Instagram, suffered a 4% drop in its stock price. Microsoft’s stock fell 1%.

Shares of Alphabet and Google defied the trend, however, remaining essentially unchanged in early trading on Tuesday.

This is a developing story. Please check back for updates.

Copyright © 2025, ABC Audio. All rights reserved.

(WASHINGTON) — President Donald Trump’s broad tariffs on imported goods from Mexico and Canada went into effect on Tuesday, along with increased duties on goods from China, a move that prompted a swift retaliation from Beijing.

“President Trump continues to demonstrate his commitment to ensuring U.S. trade policy serves the national interest,” the White House said in a statement.

Goods entering the U.S. from Mexico and Canada will carry a 25% tariff, while those from China will be subject to a 10% increase on existing tariffs, according to the White House.

Within minutes of the new U.S. tariffs taking effect, China unveiled on Tuesday its initial response by placing additional 10% to 15% tariffs on imported U.S. goods, like chicken, wheat, soybeans and beef.

Those duties will be on top of similar tariffs imposed back during the first Trump administration’s trade war in 2018. Some of those tariffs are already at 25%, though Beijing issued some waivers as a result of the 2020 “phase one” trade deal.

The new Chinese tariffs are set to come into effect for goods shipped out next Monday, March 10.

Canadian Prime Minister Justin Trudeau also promised to impose tariffs on American goods if Trump’s tariffs on Canadian goods went into effect.

He said in a statement on Monday that Ottawa would start with “tariffs on $30 billion worth of goods immediately and tariffs on the remaining $125 billion on American products in 21 days’ time.”

“Our tariffs will remain in place until the U.S. trade action is withdrawn, and should U.S. tariffs not cease, we are in active and ongoing discussions with provinces and territories to pursue several non-tariff measures,” Trudeau said in the statement.

Stock futures for the three major U.S. indexes were close to flat early Tuesday following the selloff on Monday as Trump announced his proposed tariffs would go into effect at 12:01 a.m.

The announcement sent major stock indexes plummeting, with the S&P suffered its biggest loss since December, closing at 5,849.72 — down 104.78 points or 1.76%. The Dow Jones Industrial Average closed at 43,191.24 down 649.67 points — or 1.48% — while the tech-heavy Nasdaq fell 2.64%.

Asian markets were mixed on Tuesday. The Shanghai Stock Exchange climbed less than a percentage point, while the Nikkei in Japan slipped about 1.2% and the Hang Seng in Hong Kong closed down about 0.3%.

European markets mostly traded off on Tuesday, with the DAX in Germany down about 1.6% and the FTSE 100 slipping about 0.3% midday.

The U.S. tariffs arrived about a month after Trump granted Mexico and Canada a reprieve, having reached agreements with the two countries regarding border security and drug trafficking.

ABC News’ Max Zahn contributed to this report.

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