Futures Plunge Following Trump's Tariff Threats Against EU, Apple

(RTTNews) - The major U.S. index futures are currently pointing to a sharply lower open for the markets on Friday, with stocks likely to come under pressure after ending the previous session roughly flat.

The futures plunged after President Donald Trump threatened to impose 50 percent tariffs on imports from the European Union beginning June 1st.

Trump claimed in a post on Truth Social that the EU has "been very difficult to deal with" and said trade talks with the bloc are "going nowhere!"

In a separate Truth Social, Trump also threatened to impose a 25 percent tariff on Apple (AAPL) iPhones that are not manufactured in the U.S.

Trump's threats have led to renewed to trade concerns, which had waned considerably in recent weeks after the U.S. reached trade deals with the U.K. and China.

Meanwhile, traders are also looking ahead to earnings news from Nvidia (NVDA), with the AI daring scheduled to release its fiscal first quarter results after the close of trading next Wednesday.

Stocks moved mostly higher over the course of the trading day on the Thursday but gave back ground in the latter part of the session to close roughly flat. The major averages pulled back well off their highs in the final hour of trading before closing narrowly mixed.

While the Nasdaq rose 53.09 points or 0.3 percent to 18,925.73, the Dow edged down 1.35 points or less than a tenth of a percent to 41,859.09 and the S&P 500 slipped 2.60 points or less than a tenth of a percent to 5,842.01.

Stocks showed a lack of direction early in the session but moved to the upside as the day progressed, as traders kept a closer than usual eye on treasury yields.

Treasury yields have recently moved sharply higher due in part to concerns about the fiscal impact of a Republican tax cut bill.

The yield on the benchmark ten-year note reached its highest levels in over three months early in the day but turned lower over the course of the session.

The downturn by treasury yields generated some positive sentiment on Wall Street, but buying interest waned going into the end of the day.

The tax cut bill passed the House in a largely party-line vote early this morning, but analysts warn it could add trillions to the federal government's already massive debt. The plan has sparked fears of an even wider deficit, especially as interest payments continue to soar.

In a post on Truth Social, President Donald Trump called the bill "arguably the most significant piece of Legislation that will ever be signed in the History of our Country" and urged the Senate to send the bill to his desk as soon as possible.

On the U.S. economic front, a report released by the Labor Department unexpectedly showed a slight decline by first-time claims for U.S. unemployment benefits in the week ended May 17th.

The Labor Department said initial jobless claims edged down to 227,000, a decrease of 2,000 from the previous week's unrevised level of 229,000. The dip surprised economists, who had expected jobless claims to inch up to 230,000.

Meanwhile, a separate report released by the National Association of Realtors showed existing home sales in the U.S. unexpectedly saw further downside in the month of April.

NAR said existing home sales fell by 0.5 percent to an annual rate of 4.00 million in April after plunging by 5.9 percent to a rate of 4.02 million in March. Economists had expected existing home sales to jump by 2.0 percent to a rate of 4.10 million.

Reflecting the lackluster close by the broader markets, most of the major sectors ended the day showing only modest moves.

Steel stocks showed a notable move to the downside, however, with the NYSE Arca Steel Index falling by 1.3 percent.

Utilities and gold stocks also saw some weakness on the day, while strength remained visible among airline stocks.

Commodity, Currency Markets

Crude oil futures are slumping $0.66 to $60.54 a barrel after falling $0.37 to $61.20 barrel on Thursday. Meanwhile, after sliding $18.50 to $3,295 an ounce in the previous session, gold futures are jumping $51.50 to $3,346.50 an ounce.

On the currency front, the U.S. dollar is trading at 142.53 yen versus the 144.01 yen it fetched at the close of New York trading on Thursday. Against the euro, the dollar is valued at $1.1339 compared to yesterday's $1.1281.

Asia

Asian stocks ended mixed on Friday despite a retreat in U.S. Treasury yields and comments from a Federal Reserve official that the U.S. central bank might lower interest rates in 2025 if tariff issues are resolved.

The dollar was on course to snap a four-week winning streak due to U.S. fiscal health worries. Gold headed for its biggest weekly jump in 1-1/2 months on safe-haven demand.

Oil prices fell for a fourth consecutive session and headed for the first weekly loss since April as traders braced for a potential supply boost from OPEC+.

China's Shanghai Composite Index slid 0.9 percent to 3,348.37 despite efforts by the country's central bank to boost spending. Hong Kong's Hang Seng Index finished 0.2 percent higher at 23,601.26 after a volatile session.

Japanese markets closed higher on the back of falling yields. The Nikkei 225 Index rose 0.5 percent to 37,160.47, while the broader Topix Index closed up 0.7 percent at 2,735.52.

Investors shrugged off government data that showed core inflation accelerated to 3.5 percent in April, the highest level in more than two years because of rising food and energy costs.

The yen ticked higher as hotter consumer inflation data raised the odds of another interest rate hike by year-end.

Seoul stocks fluctuated before finishing marginally lower for the day amid a lack of catalysts. Data released earlier in the day showed producer prices in the country fell for the first time in six months in April.

Samsung Biologics plummeted nearly 6 percent, LG Energy Solution gave up 2.4 percent and Hyundai Motor dropped 1.4 percent.

Financials bucked the weak trend, with KB Financial rand Shinhan Financial both rising around 2 percent.

Australian markets eked out modest gains amid expectations for aggressive interest rate cuts by the Reserve Bank of Australia.

The benchmark S&P ASX 200 Index edged up by 0.2 percent to 8,360.90, while the broader All Ordinaries Index settled 0.2 percent higher at 8,586.70.

Uranium miners surged after reports that U.S. President Donald Trump plans to sign an executive order to revitalize the nuclear energy sector. Paladin Energy jumped 6.7 percent, Boss Energy soared over 12 percent and Deep Yellow rallied 8.3 percent.

Across the Tasman, New Zealand's benchmark S&P NZX-50 Index ended down 0.5 percent at 12,596.50 despite retail sales figures for the first quarter of 2025 coming in above expectations.

Europe

After moving modestly higher earlier in the session, European stocks have moved sharply lower in reaction to President Donald Trump's threat to impose 50 percent tariffs on imports from the European Union.

The French CAC 40 Index is down by 2.9 percent, the German DAX Index is down by 2.7 percent and the U.K.'s FTSE 100 Index is down by 1.4 percent.

In economic news, the German economy logged stronger-than-estimated growth in the first quarter, a report from Destatis revealed.

Gross domestic product registered a quarterly increase of 0.4 percent compared to the previous estimate of a 0.2 percent expansion. This followed a 0.2 percent contraction in the fourth quarter.

Elsewhere, U.K. retail sales rebounded more than expected in April as good weather boosted food store sales, official data showed.

Retail sales grew 1.2 percent on a monthly basis in April, following a revised 0.1 percent rise in March. Sales were expected to climb only 0.3 percent.

The GfK Consumer Confidence Index for the United Kingdom rose by 3 points to -20 in May 2025 on hopes of easing trade tensions and the interest rate reduction by the Bank of England.

In corporate news, British investment platform AJ Bell has soared after it posted a 12 percent year-over-year increase in half-yearly profit before tax and raised its full-year guidance.

U.S. Economic News

St. Louis Federal Reserve President Alberto Musalem and Kansas City Federal Reserve President Jeffrey Schmid are due to participate in a discussion on the economy and monetary policy before the Northwest Arkansas Fireside Chat at 9:35 am ET.

The Commerce Department is scheduled to release its report on new home sales in the month of April at 10 am ET. Economists expect new home sales to tumble by 4.4 percent to an annual rate of 692,000 in April after spiking by 7.4 percent to a rate of 724,000 in March.

At 12 pm ET, Federal Reserve Board Governor Lisa Cook is due speak on "Financial Stability" at the Seventh Annual Women in Macro Conference.