>> Already grappling with a new Federal Reserve Chairman that seems willing to raise interest rates quicker than thought and fears inflation could quickly get out of hand, Wall Street found something new to fret over on Thursday. A possible full-fledged trade war. The Dow plunging more than 400 points after President Trump said, the US would slap a punitive 25% tax on steel imports and 10% on aluminum as early as next week.
Reuters correspondent Chuck Mikolajczak had his eyes on the market.>> The market was pretty much caught off guard by this to some degree, because there was an announcement from the White House saying there was gonna be no announcement on tariffs and then Trump had a meeting today. He came out said, there was gonna be a 25% tariff on steel, another 10% on aluminum.
That clearly caught the market off-guard and the market really doesn't like trade wars, and this is something that could really be the first shot across the bow, and something that could be escalated.>> The goal of the tariffs according to Trump is to rebuild the American steel and aluminum industries by protecting them from a glut of cheap global supplies mainly coming from China, but it's more than just economics.
The White House is claiming steel imports are posing a National Security Risk, because the US needs domestic steel to build tanks and war ships for the military. China has already warned that any tariffs on steel and aluminium could be met with retaliation on products the US sends to China.
Other nations have weighed in, as well. Canada has called any tariff or quota quote, unacceptable. And the European Union says, it's preparing for a fight and that's exactly what global investors don't want to hear.