Dow Jones Drops 250 Points After Trump's 35% Tariff on Canada

U.S. stocks experienced a decline on Friday, with the Dow Jones Industrial Average opening 250 points lower following President Donald Trump’s announcement of a 35% tariff against Canada. This move came as a reaction to fresh trade war concerns, with the Dow falling 250 points, the S&P 500 paring gains at -0.5%, and the Nasdaq Composite shedding 0.3%.

Trump's tariff announcement, set to take effect in August, followed his earlier threats and a 50% duty rate on Brazil. Despite these threats, stocks remain near their all-time highs, with Trump expressing optimism about the tariffs' reception. However, investor optimism may dissipate if trade wars escalate, as warned by China.

Amidst the stock market decline, Bitcoin (BTC) bucked the trend, rising by about 5% in 24 hours to hit a new all-time high above $118,000. This rally ignited bullish moves across the altcoin market, with Ethereum (ETH) crossing above the psychological $3,000 level. Bitcoin’s performance lifted crypto stocks, with MicroStrategy (MSTR), Coinbase (COIN), and Robinhood (HOOD) gaining in premarket trading. MSTR was up 2% in early trading after the U.S. stock market opened, while COIN and HOOD had pared their premarket gains.

Trump's tariff threats have added to market jitters, with remarks about potential blanket tariffs against many U.S. trading partners. The tariff on Canadian goods, announced on Thursday, is set to kick off in August. This follows Trump's announcement of a 50% duty rate on Brazil earlier in the week. Overall investor optimism, however, may dissipate if there’s a flare-up in trade wars—a scenario China recently warned of as Trump threatened tough tariffs on members of the emerging market economics bloc.