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Stock futures dropped to kick off February after President Donald Trump hit several key U.S. trading partners with tariffs, raising fears that a full-blown trade war would disrupt global supply chains, reignite inflation and slow the economy.
Futures for the Dow Jones Industrials tumbled 678 points, or 1.5% to 44,020.
Futures for the S&P 500 slumped 103 points, or 1.7%, to 5,964.25
Futures for the tech-heavy NASDAQ fell 420 points, or 2%, to 21,169.25.
President Donald Trump on Saturday slapped a 25% tariff on goods from Mexico and Canada. He also placed a 10% levy on imports from China. Energy imports from Canada received a lower 10% tariff. Canada responded with retaliatory tariffs of its own, while Mexico said it would explore levies on U.S. imports. The Chinese government, meanwhile, said it would file a lawsuit with the World Trade Organization.
Trump also signaled over the weekend that tariffs on the European Union would be imposed next.
U.S. automakers with big North American supply chains led the decline, with General Motors shares off by 7% and Ford down by 4% in premarket trading. Auto suppliers including Aptiv gave yo 5% and Avery Dennison lost 2%. Engine maker Cummins shed 3%.
Constellation Brands, a large importer of alcohol from Mexico, tumbled 5%. Shares of Chipotle, which imports avocados from Mexico, lost 3%. Nike was down 2%, while fellow clothing maker Lululemon shed 3%.
One of the positive groups were steelmakers, with Nucor gaining 2% and Steel Dynamics up nearly 4% in premarket trading.
In Japan, the Nikkei 225 dropped 2.7% Monday, while in Hong Kong, the Hang Seng returned to trading with a loss of 7.85 points, or 0.04%.
Oil prices jumped $1.92 to $74.45 U.S. a barrel.
Gold prices brightened $11.30 to $2,846.30 U.S. an ounce.
