S&P Futures Plunge With All Eyes on Trump’s ‘Liberation Day’ Tariffs

June S&P 500 E-Mini futures (ESM25) are trending down -1.01% this morning as risk sentiment took a hit ahead of U.S. President Donald Trump’s sweeping tariffs announcement.

President Trump is set to announce his reciprocal tariff plan at an event in the White House Rose Garden just as U.S. stock markets close at 4 p.m. The White House said on Tuesday that reciprocal tariffs would become effective immediately after Trump announces them, heightening concerns about the economic impact of a trade war. Bloomberg reported that several proposals are being considered, including a tiered tariff system featuring a series of flat rates for countries, along with a more tailored reciprocal plan. Also, a recently announced 25% tariff on auto imports is set to take effect at 12:01 a.m. Washington time on April 3rd.

In yesterday’s trading session, Wall Street’s main stock indexes closed mixed. Tesla (TSLA) rose over +3% after Wells Fargo added the stock to its Q2 Tactical Ideas list. Also, PVH Corp. (PVH) surged more than +18% after the company reported better-than-expected Q4 results, issued above-consensus FY25 guidance, and said it plans to enter $500 million accelerated share repurchase agreements. In addition, Crowdstrike (CRWD) gained over +2% after Stephens initiated coverage of the stock with an Overweight rating and a price target of $450. On the bearish side, Johnson & Johnson (JNJ) slumped over -7% and was the top percentage loser on the S&P 500 and Dow after a federal judge in Texas rejected the company’s third attempt to use the bankruptcy of one of its units to resolve baby powder cancer claims.

A Labor Department report released on Tuesday showed that the U.S. JOLTs job openings fell to 7.568M in February, weaker than expectations of 7.690M. Also, the U.S. ISM manufacturing index fell to a 4-month low of 49.0 in March, weaker than expectations of 49.5, while the ISM prices paid sub-index rose to a 2-3/4 year high of 69.4, stronger than expectations of 64.6. At the same time, the U.S. March S&P Global manufacturing PMI was revised upward to 50.2, beating the consensus of 49.8. In addition, U.S. construction spending rose +0.7% m/m in February, stronger than expectations of +0.3% m/m.

Richmond Fed President Tom Barkin stated on Tuesday that President Trump’s tariffs could drive up both inflation and unemployment, posing a significant challenge for the central bank. Barkin noted that a tariff-driven price shock could lead to a “cage match” between a frustrated consumer unwilling to pay more and a goods and services provider who “really believes” they must pass on increases. Regarding the labor market, the Richmond Fed chief said, “If you are a company that can’t raise prices, then your margin goes down. You’re going to start working on operational efficiencies, and that means headcount.” Also, Chicago Fed President Austan Goolsbee cautioned about the adverse effects of any pullback in consumer spending or business investment stemming from tariff-related uncertainty. “If the consumer stops spending or business stops investing because they’re uncertain or they’re afraid where we’re headed, that would be a bit of a mess,” Goolsbee said in an interview on Fox News.

Meanwhile, U.S. rate futures have priced in an 85.5% probability of no rate change and a 14.5% chance of a 25 basis point rate cut at the May FOMC meeting.

On the economic data front, investors will focus on the U.S. ADP Nonfarm Employment Change data, which is set to be released in a couple of hours. Economists, on average, forecast that the March ADP Nonfarm Employment Change will stand at 118K, compared to the February figure of 77K.

U.S. Factory Orders data will also be reported today. Economists foresee this figure coming in at +0.5% m/m in February, compared to the previous number of +1.7% m/m.

U.S. Crude Oil Inventories data will be released today as well. Economists expect this figure to be -0.400M, compared to last week’s value of -3.341M.

In addition, market participants will be anticipating a speech from Fed Governor Adriana Kugler. 

In the bond market, the yield on the benchmark 10-year U.S. Treasury note is at 4.174%, up +0.43%.

The Euro Stoxx 50 Index is down -0.57% this morning as investors brace for U.S. President Donald Trump’s tariff announcement later in the day. Uncertainty surrounding the size and scope of the tariffs, along with potential retaliatory actions from other nations, has continued to dampen sentiment. Healthcare stocks were among the biggest losers on Wednesday. Meanwhile, French industry minister Marc Ferracci stated on Wednesday that Europe will respond to new U.S. tariffs in a proportionate way but will avoid further escalation of tensions. “Europe has always been on the side of negotiation and calming things down, because trade wars, you know, only produce losers,” Ferracci told RMC radio. European Commission President Ursula von der Leyen said Tuesday that the European Union remains open to tariff negotiations with the U.S. but will implement retaliatory measures if needed. In corporate news, Mercedes-Benz Group Ag (MBG.D.DX) slipped nearly -1% after Bloomberg reported that the automaker might withdraw its most affordable models from the U.S. market if tariffs render their sales unfeasible. At the same time, Svitzer A/S (SVITZ.C.DX) jumped over +29% after A.P. Moller Holding offered to buy the company for 9 billion Danish crowns ($1.30 billion) in cash.

The European economic data slate is mainly empty on Wednesday.

Asian stock markets today closed in the green. China’s Shanghai Composite Index (SHCOMP) closed up +0.05%, and Japan’s Nikkei 225 Stock Index (NIK) closed up +0.28%.

China’s Shanghai Composite Index closed just above the flatline today as cautious sentiment prevailed ahead of U.S. President Donald Trump’s announcement of new tariffs. Bank stocks outperformed on Wednesday. Since taking office in January, Trump has already imposed 20% tariffs on Chinese imports. In March, China responded with retaliatory measures against certain U.S. tariffs. Meanwhile, analysts noted that sentiment could suffer if the size and scope of new U.S. trade barriers prove too aggressive, with more volatility expected if countries targeted by the levies choose to retaliate. “Risk aversion will take hold if the U.S. tariffs are broad and aggressive, with a second wave of volatility expected should China and the EU respond swiftly with retaliatory measures,” said Philip Wee, senior FX strategist at DBS. According to a social media account associated with China’s state broadcaster, China stated earlier this week that it aims to coordinate its response with Japan and South Korea to upcoming U.S. tariffs. In other news, Standard Chartered on Wednesday raised its 2025 economic growth forecast for China to 4.8% from 4.5%, following strong PMI data from the country. In corporate news, AECC Aviation Power tumbled about -10% after reporting a 39% year-over-year decline in annual profit.

Japan’s Nikkei 225 Stock Index closed a volatile session higher as investors nervously awaited U.S. President Donald Trump’s tariff announcement. Heavy industry and video game stocks led the gains on Wednesday. The benchmark index opened higher, then dropped to its lowest level since September 11th, before closing the session with modest gains. Meanwhile, Bank of Japan Governor Kazuo Ueda stated on Wednesday that new U.S. tariffs could significantly affect world trade, warning of a potential impact on global growth. “The impact of U.S. tariff policy on the global economy is highly uncertain. But depending on the range and scale of U.S. tariffs, they could have a big impact on each country’s trade activity,” Ueda told parliament. His first public remarks since Trump officially announced a 25% auto tariff last week indicated he’s still monitoring the situation, while avoiding any signals about the BOJ’s rate hike trajectory. In other news, Goldman Sachs picked the yen as the best hedge against a potential U.S. recession and tariff-related risks. The bank also cut its year-end projection for the 10-year Japanese government bond yield to 1.50% from 1.60%, citing the increased risk of a U.S. recession. In corporate news, Tokyo Sangyo rose over +3% after a filing showed that Seika would acquire an 11.6% stake in the company on April 3rd. The Nikkei Volatility Index, which takes into account the implied volatility of Nikkei 225 options, closed down -1.80% to 27.34.

Pre-Market U.S. Stock Movers

nCino (NCNO) plummeted over -30% in pre-market trading after the cloud-based software company posted weaker-than-expected Q4 adjusted EPS and issued downbeat FY26 guidance. 

Charles Schwab (SCHW) rose more than +1% in pre-market trading after Citi upgraded the stock to Buy from Neutral with a price target of $102.

TTEC Holdings (TTEC) soared about +30% in pre-market trading after the company announced its willingness to engage with CEO Kenneth Tuchman regarding his $6.85 per share proposal.

Paramount Global (PARA) fell over -1% in pre-market trading after Deutsche Bank downgraded the stock to Hold from Buy.

Venus Concept (VERO) slumped more than -7% in pre-market trading after disclosing an $11 million debt-to-equity exchange transaction with Madryn Asset Management.

You can see more pre-market stock movers here

Today’s U.S. Earnings Spotlight: Wednesday - April 2nd

RH (RH), Unifirst (UNF), BlackBerry (BB), Penguin Solutions (PENG), Cognyte Software (CGNT), AngioDynamics (ANGO), Franklin Covey (FC), Resources Connection (RGP), Bassett (BSET), ClearSign (CLIR).