Tech, Auto Shares Jump After Trump Suggests More Tariff Relief

Shares in Big Tech and automotive sectors increased following the decision by the U.S. to eliminate tariffs on smartphones and other electronics from China on the weekend and President Donald Trump's Monday announcement about potential exemptions to existing auto tariffs as part of his volatile trade policy changes.

The U.S. stock market, the dollar and Treasury bonds experienced a selloff after President Trump introduced tariffs that would increase consumer and business costs for imported goods by approximately 25%. After Monday's market rebound the overall S&P 500 index remains approximately 8% below its starting value for this year.

Investors began to doubt the safe-haven status of America due to shifting policies which also reduced consumer and business confidence. The White House reversed its previous position after a shock response but Trump declared additional tariffs were coming over the weekend.

During a White House address on Monday Trump expressed his consideration to adjust the 25% tariffs on foreign auto and auto parts imports from Mexico and Canada. The tariffs could increase car prices by thousands of dollars but Trump stated car manufacturers require time to shift production to domestic facilities.

After the North American Free Trade Agreement was renegotiated during Trump's first term U.S. automakers created an advanced supply chain that requires multiple border crossings for vehicles at different completion levels. The stock prices for General Motors and Ford Motor ended Monday up by 3.5% and 4.1% respectively.

We support the President's objective of boosting American automotive production along with the Administration's continuous discussions. The American Automotive Policy Council head Matt Blunt stated Monday that broad tariffs on parts threaten to impede our mutual objective of developing a flourishing American auto industry while pointing out that supply chain transitions will need time.