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Investing.com --The S&P 500 slumped Monday, as President Donald confirmed that tariffs on Mexico and Canada will begin on Tuesday, stoking further jitters about the economy just as data continue to surprise to the downside.
At 4:24 p.m. ET (20:24 GMT), the Dow Jones Industrial Average fell 751 points, or 1.7%, the S&P 500 index fell 2%, and the Nasdaq Composite fell 2.9%.
Major stock indexes lost sharply in February, mainly due to volatility stemming from Trump tariffs and losses in tech on changing expectations around artificial intelligence.
Trump confirms tariffs on Mexico, Canada to go ahead
President Donald Trump confirmed Monday that tariffs on Mexico, and Canada are set to go ahead on Tuesday as both nations have now run out of room to negotiate a deal.
Trump’s proposed 25% tariffs on non-energy goods from Canada and all items from Mexico -- as well as an additional 10% surcharge on imports from China -- are due to come into effect on Tuesday.
Economists have flagged that tariffs could strengthen the dollar, denting the competitiveness of U.S.-made goods.
ISM PMI data in focus
The Institute for Supply Management’s manufacturing purchasing managers’ index increased by 50.3 last month, down from 50.9 in January, which was the first expansion since October 2022. Economists had predicted a reading of 50.6.
A number above 50 indicates expansion in the manufacturing sector, which makes up just over 10% of the U.S. economy.
"U.S. manufacturing activity expanded marginally for the second month in a row in February after 26 consecutive months of contraction," said Timothy Fiore, Chair of the ISM Manufacturing Business Survey Committee.
"Demand eased, production stabilized, and destaffing continued as panelists’ companies experience the first operational shock of the new administration’s tariff policy."
The data comes ahead of a busy economic calendar, with a crucial nonfarm payrolls report for February set to round off the week.
Nvidia slides as China reportedly skirting US export ban; Intel shines, Capri jumps on potential Versace sale
NVIDIA Corporation (NASDAQ:NVDA) fell more than 9%, dragging the broader chip sector lower after The Wall Street Journal reported Sunday that Chinese buyers are navigating around U.S. export bans to order the company’s Blackwell chips.
Intel Corporation (NASDAQ:INTC) gave up earlier gains which had followed a Reuters report that Nvidia and Broadcom (NASDAQ:AVGO) are running manufacturing tests with Intel.
In deal-making news, meanwhile, Capri Holdings Ltd (NYSE:CPRI) is inching closer to selling Varsace to Prada (OTC:PRDSY) for nearly €1.5 billion euros ($1.6 billion), Bloomberg reported, citing unnamed sources.
Bitcoin gives up Trump-fueled gains
Bitcoin gave up intraday gains to trade more than 8% lower despite optimism over a U.S. crypto strategic reserve.
Trump on Sunday repeated his plans for a Crypto Strategic Reserve, stating that he had directed an executive group to proceed with the project. He claimed that Bitcoin, Ether, XRP, Solana, and Cardano will comprise the reserve.
(Peter Nurse, Scott Kanowsky and Ayushman Ojha contributed to this article.)
