Investing.com-- U.S. stock index futures fell on Sunday evening as risk aversion grew in anticipation of President Donald Trump’s April 2 deadline to impose more trade tariffs, while concerns over slowing economic growth persisted.
Futures extended losses after a dismal session on Friday, as investors were spooked by higher-than-expected inflation, which could pressure the U.S. economy and keep interest rates underpinned in the long term.
Markets were further rattled by a report over the weekend that Trump will seek broader and bigger tariffs, while Goldman Sachs said it now saw a greater chance of a U.S. recession.
S&P 500 Futures fell 0.7% to 5,585.75 points, while Nasdaq 100 Futures fell 1.2% to 19,217.50 points by 20:05 ET (00:05 GMT). Dow Jones Futures fell 0.4% to 41,693.0 points.
Trump tariff jitters grow as ‘liberation day’ approaches
Trump is set to unveil several more trade tariffs on April 2, a date he has repeatedly touted as “liberation day.”
A report over the weekend said Trump will consider higher tariffs against a broader range of countries, as he embarks on a trade agenda aimed at correcting alleged trade imbalances against the U.S.
The U.S. president rattled markets last week by imposing a 25% tariff on all non-American cars. The tariff will take effect from April 2, where Trump could also announce tariffs against other sectors such as commodities, semiconductors and pharmaceuticals.
Markets fear that Trump’s tariffs, which will be borne by U.S. importers, will underpin inflation and compromise U.S. economic growth in the coming months.
Goldman Sachs sees a 35% chance of a recession in the next 12 months, and also expects inflation to rise further above the Federal Reserve’s 2% target in 2025.
Wall St slumps on trade, inflation jitters; tech battered by AI doubts
Wall Street indexes fell sharply on Friday after PCE price index inflation- the Fed’s preferred inflation gauge- read higher than expected for February.
The reading gives the Fed more impetus to keep interest rates steady for longer, especially in the face of heightened uncertainty over the economy.
Inflation concerns were further underpinned by concerns over Trump’s tariffs.
Additionally, losses in major technology stocks, such as chipmaking major NVIDIA Corporation (NASDAQ:NVDA), also pressured Wall Street. The stock and several of its big tech peers were dented by reports that investment in artificial intelligence data centers- which was a major source of demand in the past two years- now appeared to be slowing amid saturation in the sector.
The S&P 500 slid nearly 2% on Friday to 5,580.94 points, while the NASDAQ Composite slumped 2.7% to 17,322.99 points. The Dow Jones Industrial Average fell 1.7% to 41,683,90 points.
