Dubai Telegraph - US stocks tumble on tariff fog, worries over AI

On Friday, US stocks had taken in stride a Supreme Court ruling blocking many of US President Donald Trump's tariffs and his defiant response announcing new levies.

But markets adopted a more pessimistic view of things on Monday after Trump over the weekend lifted the new levy to 15 percent from the initial 10 percent announced on Friday.

All three major US indices lost more than one percent.

On Monday, Trump said on social media that countries that "play games" in the aftermath of the Supreme Court ruling, "will be met with a much higher Tariff, and worse, than that which they just recently agreed to."

European Union lawmakers have put a key trade deal with the United States on hold, demanding clarity on the impact of the new tariffs.

"The Supreme Court ruling last week against the Trump tariffs has thrown global trading partners, countries, companies, and the supply chain into a very confused state wondering about what is the current state of tariffs going forward," said a note from Wedbush analyst Dan Ives.

But trade uncertainty was not the only headwind facing stocks, with analysts pointing to worry over the AI impact on established companies, as well as the risk of potential US military strikes on Iran.

"Fear is beginning to spread on Wall Street with respect to a few things," said Adam Sarhan of 50 Park Investments, who flagged upcoming Nvidia earnings as potentially consequential to the broader market.

"If Nvidia goes down like Palantir went down, the market could really have a really big pullback," Sarhan said.

Among Wall Street's biggest losers was Dow component IBM, which sank more than 13 percent on worries that one of the company's major data businesses was threatened by a new offering from AI company Anthropic.

While Trump's latest tariff measures have added to uncertainty and played a role in a drop in European stocks, a switch to a 15 percent rate was favorable to several Asian countries that had higher tariffs on their goods in place.

Hong Kong's stock market closed up more than two percent, with share prices of e-commerce titans Alibaba and JD.com surging more than three percent.

Seoul hit another record high thanks to big advances for chipmakers Samsung Electronics and SK Hynix.

Singapore, Wellington, Taipei, Mumbai, Bangkok and Manila also rose. Sydney dipped.

Among US sectors, private equity stocks had a bad day after Blue Owl Capital last week announced restrictions on investor withdrawals, reviving worries about the private credit sector.

Blue Owl dropped 3.4 percent, while Apollo Global Management fell 5.0 percent and Blackstone shed 6.2 percent.

- Key figures at around 2115 GMT -

New York - Dow: DOWN 1.7 percent at 48,804.06 (close)

New York - S&P 500: DOWN 1.0 percent at 6,837.75 (close)

New York - Nasdaq Composite: DOWN 1.1 percent at 22,627.27 (close)

London - FTSE 100: FLAT at 10,684.74 (close)

Paris - CAC 40: DOWN 0.2 percent at 8,497.17 (close)

Frankfurt - DAX: DOWN 1.1 percent at 24,991.97 (close)

Hong Kong - Hang Seng Index: UP 2.5 percent at 27,081.91 (close)

Shanghai - Composite: Closed for a holiday

Tokyo - Nikkei 225: Closed for a holiday

Euro/dollar: UP at $1.1792 from $1.1784 on Friday

Pound/dollar: UP at $1.3492 from $1.3480

Euro/pound: UP at 87.40 pence from 87.41 pence

Dollar/yen: DOWN at 154.68 yen from 155.05 yen

Brent North Sea Crude: UP 0.4 percent at $71.49 per barrel

West Texas Intermediate: UP 0.3 percent at $66.31 per barrel

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Y.Sharma--DT