Wall Street keeps shaking because of tariffs. Stocks jumped to a big early gain, gave it back and then went up again as a volatile week for the market rolls on.
Wall Street keeps shaking because of tariffs. Stocks jumped to a big early gain, gave it back and then went up again as a volatile week for the market rolls on.
By Stan Choe
March 13, 2025 — 4.15am
Wall Street keeps shaking because of tariffs. Stocks jumped to a big early gain, gave it back and then went up again as a volatile week for the market rolls on.
The competing drivers of the market were an encouraging inflation update and the retaliation by other countries following President Donald Trump’s latest escalation in his trade war.
The S&P 500 was up 0.8 per cent in afternoon trading after completely erasing an initial leap of 1.3 per cent and then regaining some ground. The unsettled trading comes a day after the index briefly fell more than 10 per cent below its all-time high set last month.
The Dow Jones also swung sharply, pinging between a gain of 287 points and a loss of 423. It was down 36 points, or 0.1 per cent in early afternoon trade, while the Nasdaq composite was 1.1 per cent higher. The Nasdaq held up much better because of gains for Nvidia, Tesla and AI-related companies.
The Australian sharemarket is set to edge up, with futures a pointing to a gain of 12 points, or 0.2 per cent at the open. The ASX shed 1.3 per cent on Wednesday as The Australian sharemarket accelerated its sell-down on Wednesday, taking its losses over the past two sessions to more than $50 billion, after Trump ruled out exempting Australia from America’s 25 per cent tariffs on aluminium and steel.
Dragging Wall Street lower were US companies that could be set to feel pain because of Trump’s trade war. Brown-Forman, the company behind Jack Daniel’s whiskey, tumbled 6.9 per cent, and Harley-Davidson sank 5.6 per cent.
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US bourbon and motorcycles are just two of the products the European Union is targeting with its own tariffs announced Wednesday. The moves were in response to Trump’s 25 per cent tariffs on steel and aluminum that kicked in earlier in the day.
“We deeply regret this measure,” European Union President Ursula von der Leyen said. “Tariffs are taxes. They are bad for business, and worse for consumers.”
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The question hanging over Wall Street is how much pain Trump will let the economy endure through tariffs and other policies in order to get what he wants. He’s said he wants manufacturing jobs back in the United States, along with a smaller US government workforce, more deportations and other things.
Even if Trump ultimately goes with milder tariffs than feared, damage could still be done. The dizzying barrage of on -again- off -again announcements on tariffs has already begun sapping confidence among US consumers and businesses by ramping up uncertainty. That in itself could cause US households and businesses to pull back on spending, which would hurt the economy.
On Tuesday, for example, Trump said he would double tariffs announced on Canadian steel and aluminum, only to walk it back later in the day after a Canadian province pledged to drop a retaliatory measure that had incensed Trump.
Several US businesses have said they’ve already begun seeing a change in behavior among their customers.
Delta Air Lines sank 2.9 per cent for one of the market’s sharpest losses to compound its drop of 7.3 per cent from the prior day, when the carrier said it’s seeing demand weaken for close-in bookings for its flights.
Casey’s General Stores, the Ankeny, Iowa-based company that runs nearly 2,900 convenience stores in 20 states, offered some more encouragement. It reported stronger profit and revenue for the latest quarter than analysts expected thanks in part to strength for sales of hot sandwiches and fuel. It also kept steady its forecast for upcoming revenue this year.
Casey’s stock rose 6.2 per cent.
Some of the market’s biggest gains came from companies in the artificial-intelligence industry. It’s a bounce back after AI stocks got crushed recently by worries their prices had gone too stratospheric in the market’s run to record after record in recent years.
Nvidia climbed 6.5 per cent to trim its loss for the year so far to 13.7 per cent. Server-maker Super Micro Computer rallied 4.3 per cent, and GE Vernova, which is helping to power AI data centers, rose 6 per cent.
Elon Musk’s Tesla, whose price had more than halved since mid-December, was heading toward its first back-to-back gain in a month. It added 7.7 per cent.
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In stock markets abroad, indexes rose across much of Europe after a mixed session in Asia.
In the bond market, Treasury yields edged up to regain more of their losses from recent months sparked by worries about the US economy’s strength. The 10-year Treasury rose to 4.30 per cent from 4.28 per cent late Tuesday and from 4.16 per cent at the start of last week.
Wednesday’s inflation report gave some encouragement when worries are high that Trump’s tariffs could drive prices even higher for US households after US importers pass on the costs to their customers.
It’s also helpful for the Federal Reserve, which had been cutting interest rates last year to boost the economy before pausing this year partly because of concerns about stubbornly high inflation.
Worries had been rising about a worst-case scenario for the economy and for the Fed, one where economic growth was stagnating but inflation remained high. The Fed has no good tool to fix such “stagflation” because lower interest rates can push inflation higher.
AP
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