Trump Shrugs Off Market Decline Amid New Auto Tariffs

As President Donald Trump‘s auto tariffs affected the stock market negatively on Wednesday, he downplayed the significance of the market drop, emphasizing that the markets can "take care of itself."

What Happened: During a press briefing on Wednesday, Trump was questioned about the decline in the market following a three-day rally, as the newly implemented auto tariffs led to another round of decrease in the stock indices.

In his response, Trump expressed a desire to "see jobs" and indicated that he was not overly concerned about the stock market's performance. "That can take care of itself in one day, two days, or one week," he stated.

A reporter highlighted the closing figures, noting that the NASDAQ was down 2% and the S&P 500 was down 1%. Trump responded, "Is that today?" After receiving confirmation, he reiterated, "I didn't see that… that can take care of itself." (source)

The downturn on Wednesday pushed the Nasdaq 100 into a correction zone, declining 10.38% from its 52-week high, while the S&P 500 index dropped 7.08% from its record levels. The Dow Jones saw a decrease of 5.81% from its 52-week high.

Why It Matters: The new auto tariffs, which will begin on April 3, are designed to bring in $100 billion annually and boost U.S. manufacturing while decreasing dependence on global supply chains. Trump claimed, "This will continue to spur growth." However, domestic automakers utilizing global components may face increased costs and reduced sales. The administration argued that automakers have surplus capacity for domestic production and were aware of impending tariffs. Under the USMCA, the 25% tariff applies only to non-U.S. materials in vehicles and parts sourced from Mexico and Canada.

Earlier this month, Trump hinted at the possibility of a recession, stating that the economy was undergoing a "period of transition."

Automotive ETFs Performance

Investors are watching several automotive ETFs, which are responding to the shifts in the market landscape:

Automobile ETFs	YTD Performance	One Year Performance
First Trust S-Network Future Vehicles & Tech ETF (CARZ)	-0.39%	-2.56%
abrdn Physical Palladium Shares ETF (PALL)	5.97%	-2.60%
Global X Autonomous & Electric Vehicles ETF (DRIV)	-2.43%	-8.84%
Global X Lithium & Battery Tech ETF (LIT)	0.47%	-11.21%
KraneShares Electric Vehicles and Future Mobility (KARS)	5.82%	-1.68%

Recent Market Movements

Price Action: The following day, the SPDR S&P 500 ETF Trust (SPY) and the Invesco QQQ Trust ETF (QQQ), which track the S&P 500 index and Nasdaq 100 index respectively, exhibited mixed performance in premarket trading. The SPY increased by 0.039% to $568.81, whereas the QQQ fell by 0.11% to $483.86, according to recent market data.

The previous day, SPY experienced a decline of 1.19% to $568.59, and QQQ saw a drop of 1.84% to $484.38.

Overall, as the markets adjust to the implications of the new auto tariffs, investors are closely monitoring developments impacting both the stock market and the automotive industry.

Trump, Tariffs, Market, ETFs, Automotive