The US markets ended significantly lower on Friday, with losses of around one and a half percent each, after President Donald Trump revealed plans to use tariffs to compel Mexico to make efforts to stop the flow of illegal immigrants across the country and into the US. The Dow dropped to a four-month closing low, while the Nasdaq and the S&P 500 hit their lowest closing levels in well over two months. Trump said on June 10, the United States will impose a 5% Tariff on all goods coming into our Country from Mexico, until such time as illegal migrants coming through Mexico, and into our Country, STOP. He added that the Tariff will gradually increase until the Illegal Immigration problem is remedied, at which time the Tariffs will be removed. Trump revealed in a subsequent White House statement the tariffs will be raised to 10 percent on July 1, if the crisis persists, with tariffs eventually rising as high as 25 percent by October 1. The president argued the sustained imposition of tariffs will produce a massive return of jobs back to US, describing the move as an effort to firmly and forcefully stand up for America's interests.
Meanwhile, reflecting the collapse of US-China trade talks, the University of Michigan released a report showing a bigger than expected downward revision to its reading on US consumer sentiment in the month of May. The report said the consumer sentiment index for May was downwardly revised to 100 from the preliminary reading of 120.4. The index remains notably higher than the final April reading of 97.2.
Dow Jones Industrial Average slipped 354.84 points or 1.41 percent to 24815.04, Nasdaq declined 114.57 points or 1.51 percent to 7453.15 and S&P 500 was down by 36.80 points or 1.32 percent to 2752.06.
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