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The Dow Jones Industrial Average on Monday staged a major comeback, recovering steep losses from earlier in the session after President Donald Trump said tariffs against Mexico would be paused for one month.
Shares in the 30-stock index backpedaled 122.75 points to 44,412.91.
The S&P 500 slumped 45.96 points to 5,994.52
The NASDAQ fell 235.49 points, or 1.2%, to 19.391.96
Stocks initially dropped Monday after President Donald Trump hit several key U.S. trading partners with tariffs over the weekend, raising fears that a full-blown trade war would disrupt global supply chains, reignite inflation and slow the economy. But gains were rapidly dissolving amid comments from Mexico President Claudia Sheinbaum.
But a post from Mexico’s President Claudia Sheinbuam following a conversation with Trump sparked an intraday comeback. “We had a good conversation with President Trump with great respect for our relationship and sovereignty; we reached a series of agreements,” Sheinbaum wrote in a post, according to a translation from Spanish.
Trump on Saturday slapped a 25% tariff on goods from Mexico and Canada; energy imports from Canada will have a 10% tariff. Trump also placed a 10% levy on imports from China. Trump also signaled over the weekend that tariffs on the European Union would be imposed next.
U.S. automakers with big North American supply chains led the decline, with General Motors shares off by 5% and Ford down by 4%. Auto suppliers including Aptiv caved 8% and Avery Dennison lost 2%. Engine maker Cummins faltered 2%.
Constellation Brands, a large importer of alcohol from Mexico, tumbled 4%. Shares of Chipotle, which imports avocados from Mexico, lost 2%. Nike was down 4%, while fellow clothing maker Lululemon shed 3%.
Prices for the 10-year Treasury sagged late afternoon, raising yields to 4.54% from Friday’s 4.52%. Treasury prices and yields move in opposite directions.
Oil prices regained 38 cents to $72.91 U.S. a barrel.
Prices for gold recaptured $21.70 an ounce to $2,856.70 U.S.
