Reaction from around the world as steel tariffs double
“Strongly regret,” and “unfair” were some of the reactions from trade partners around the world as the U.S. doubles tariffs on steel imports.
U.S. stocks closed lower as investors wondered if President Donald Trump’s phone call with Chinese President Xi Jinping would yield positive results.
In a post on Truth Social, Trump said he had a “very good phone call” with Xi, but it was unclear what was accomplished except that the two countries trade teams would be meeting again “shortly.”
The blue-chip Dow closed down 0.25%, or 108 points, to 42,319.74; the broad S&P 500 dipped 0.53%, or 31.51 points, to 5,939.30; and the tech-laden Nasdaq slipped 0.83%, or 162.04 points, to 19,298.45. The benchmark 10-year yield edged up to 0.03%.
The call comes after Trump accused China of violating a trade agreement last month that put some tariffs on ice. It also marks their first known formal contact since Trump took office, and investors hope could lead to averting a trade war. Trump, who initiated the call, has said direct talks with Xi would be the only way to resolve trade differences, but Xi has previously relied instead on advisers to negotiate trade terms.
Jobs watch
Weekly jobless claims rose by 8,000 to 247,000 in the latest week, topping the 236,000 economists polled by Dow Jones had expected and adding to the mixed jobs picture. Earlier in the week, data showed more-than-expected job openings in April, but a private jobs survey showed a marked slowdown in new hiring.
“Jobless claims continue to rise, but they are rising at a slow pace, so it’s a trend worth watching, but too soon to sound the alarm,” said Chris Zaccarelli, chief investment officer for Northlight Asset Management.
The key monthly jobs report for May is due before the bell on June 6. Economists, on average, expect 130,000 new jobs created and a 4.2% unemployment rate.
The “jobs report will be especially important because it will provide an updated view into the labor market – and that’s what we believe the Fed is watching most closely at this point,” Zaccarelli said.
Separately, unit labor costs, which measure compensation against productivity, unexpectedly increased 6.6% in the first three months of the year, according to a revised estimate from the Bureau of Labor Statistics. Productivity fell 1.5%, more than expectations for a decline of 0.8%. Higher labor costs coupled with lower productivity is generally seen as inflationary.
Corporte news
- Discount retailer Five Below’s quarterly estimates topped analysts’ forecasts. Shares rose 5.59%.
- Whiskey maker Brown-Forman shares fell more than 17% after the company missed earnings estimates in the final three months of its fiscal year due to tariffs and weak discretionary spending on alcohol. It also warned sales and operating income could decline in the single-digit range in the new fiscal year.
- Tesla shares slid more than 14% as chief executive Elon Musk continues loudly criticizing Trump’s tax bill, prompting Trump to call Musk “CRAZY” and suggest that he may target the Tesla CEO’s government contracts.
- Software company MongoDB topped analysts’ estimates with its quarterly results. Shares jumped almost 13%.
- PVH Corp reported better-than-expected results in the first three months of the year but lowered its profit outlook for the current quarter due to tariffs. Shares shed 18%.
- Winnebago said it expects to adjust headcount and shift production plans due to eroding demand for motorhomes. Shares dropped 6%.
- Procter & Gamble said it would cut 7,000 jobs, or roughly 15% of its nonmanufacturing workforce, over the next two years. Shares fell almost 2%.
Broadcom, Docusign and Lululemon will follow with their results after the close.
Cryptocurrency
Circle Internet Group priced its initial public offering at $31 per share, above expectations for $27 to $28 per share.
Bitcoin was last down 3.09% at $101,516.20.
(This story was updated with new information.)
Medora Lee is a money, markets, and personal finance reporter at USA TODAY. You can reach her at mjlee@usatoday.com and subscribe to our free Daily Money newsletter for personal finance tips and business news every Monday through Friday.
