Overview

President Trump has reignited trade tensions that were thought to be on the decline, surprising markets this morning.

Key Highlights:

• Risk assets, including Bitcoin, saw a significant drop in response to Trump’s announcement of a 50% tariff on all EU imports starting June 1, along with a 25% tariff on Apple iPhones produced outside the United States.
• Bitcoin, which had been comfortably above $111,000, plummeted by roughly 2.5% in the aftermath, reaching around $108,600.

“The European Union … has been very difficult to deal with,” said the president in a Truth Social posting. “Our discussions with them are going nowhere! Therefore, I am recommending a straight 50% tariff on the EU, starting on June 1.”
Translation: The EU has been challenging in negotiations, leading to the recommendation of a 50% tariff on imports.

As recently as Friday, expectations prior to the holiday weekend were calm, but Trump’s comments have shaken investors. In addition, Tim Cook of Apple received a pointed reminder from Trump regarding the manufacturing of iPhones intended for the U.S. market.

The repercussions were felt in pre-market trading, with U.S. stock index futures flipping from gains to losses of nearly 2%, and Apple shares declining by 3.6%.