The Dow, S&P 500, and Nasdaq closed sharply lower Friday, marking the end of a turbulent week on Wall Street. Investors were spooked by President Donald Trump’s latest escalation in the global trade war, including new tariff threats targeting the European Union (EU) and major smartphone manufacturers.
From the Oval Office, President Trump announced plans to impose a 50% tariff on all imports from the EU starting June 1. Trump criticized the EU, describing it as “very difficult to deal with,” and asserted that there would be no tariffs if foreign companies built manufacturing plants in the U.S.
“I’m not looking for a deal,” Trump stated. “If somebody comes in and wants to build a plant here, I can talk to them about a little bit of a delay.”
Trump also demanded that Apple and other smartphone makers manufacture their devices domestically or face a 25% tariff. An administration official confirmed that Apple CEO Tim Cook met with Trump earlier this week, though details of their discussion remain unclear.
On a recent earnings call, Cook warned investors that tariffs could cost Apple nearly $1 billion this quarter alone. Trump’s threats extended to global competitor Samsung, signaling his intent to overhaul smartphone manufacturing supply chains.
Economists argue that these policies could significantly raise smartphone prices for American consumers. “This move is likely to burden families without creating substantial job opportunities,” said former Treasury Secretary Larry Summers.
While threatening trade penalties, Trump also announced a $14 billion partnership between U.S. Steel and Japan’s Nippon Steel, which he said would keep U.S. Steel’s headquarters in Pittsburgh. The deal follows months of regulatory hurdles but provides a rare bright spot amid the administration’s confrontational trade policies.
Summers criticized the administration’s approach, warning it could harm the U.S. economy by alienating trade partners and increasing borrowing costs. “We’re becoming a less trusted economic partner,” Summers said, adding that higher tariffs and strained relationships could weaken the U.S. dollar and raise costs for imported goods.
Trump’s aggressive trade stance is coupled with stricter immigration policies, including measures affecting international students at U.S. universities. Harvard University, which has faced funding cuts under Trump’s administration, warns of the broader economic and intellectual costs.
Foreign students contribute significantly to U.S. innovation, with 44% of American billion-dollar startups founded or co-founded by immigrants. For Harvard alone, 24 of these “unicorn” companies were linked to international students, according to Axios.
“We’re making a choice to assemble iPhones instead of inventing them,” Summers said, lamenting policies that deter global talent. “This will make us poorer as a nation.”
As trade and immigration tensions mount, experts warn of long-term damage to America’s global leadership in business, technology, and education. For now, Wall Street investors remain wary, with markets reflecting uncertainty over the administration’s unpredictable policy decisions.