- The Dow Jones tumbled nearly 900 points peak-to-trough on Tuesday.
- President Trump kicked off the next leg of his trade war with Canada.
- JOLTS came in slightly stronger than expected, but geopolitics dominate.
The Dow Jones Industrial Average (DJIA) shed further weight on Tuesday, dropping around 450 points on the day, or 1.1% after United States (US) President Donald Trump vowed to heat up his own trade war with Canada. President Trump took to his Truth Social account early Tuesday, informing his social media followers that he’s instructed his Secretary of Commerce to impose an additional 25% tariff on all Canadian steel and aluminum exports to the US, bringing the new total to 50% on all Canadian metals. The new tariffs are, in theory, slated to go into effect on Wednesday morning.
The Dow Jones plunged to an intraday low near 41,175 on the trade war headlines, and although the Trump administration had already pivoted away from its threat of fresh tariffs on Wednesday, the damage had been done, and the Dow Jones ended Tuesday near 41,500.
Donald Trump remains deeply unsatisfied with the conditions of US dairy trade with Canada as outlined in his own bespoke USMCA trade agreement that came out of NAFTA renegotiations that Trump demanded during his first term as US President. Under USMCA, Canada allows a certain amount of US dairy across its borders entirely tariff-free, then imposes steep trade fees to clamp down on dairy imports to prevent US economic dumping. President Trump appears to be entirely unsatisfied with the terms of his own bespoke trade agreement, declaring via social media that his steep Canadian metals tariffs won’t be rescinded until Canada arbitrarily chooses to violate the terms set out for it under the USMCA and drops all cap-trade tariffs on US dairy products entirely.
US JOLTS Job Openings data came in slightly stronger than expected, helping to provide some stability for otherwise rattled markets. Job postings increased to 7.74M in January, climbing above the expected print of 7.63M and rising from December’s 7.508M, which was revised slightly lower from 7.6M.
Dow Jones news
Most of the securities listed on the Dow Jones are printing in the red on Tuesday as markets grapple with the latest iteration of Trump’s self-styled trade war with some of the US’s closest trading partners. Salesforce (CRM) rebounded 1.9% to $278 per share, and Nvidia (NVDA) rose 1.7% to $109 per share as tech darlings pare recent losses amid the cooling AI tech rally.
On the low side, Verizon (VZ) tumbled around 7% to $43 per share, falling after guidance from a Verizon Communications wireless executive warned that new customer additions would likely come in “soft” during the current quarter. Disney (DIS) fell 4.4% to $98.50 per share, and Apple (AAPL) also declined 3.5% to fall below $220 per share as trade war fears ramp up.
Dow Jones price forecast
Now that the seal is finally broken and the Dow Jones has pierced the 200-day Exponential Moving Average (EMA) near the 42,000 key price handle for the first time in over two years, bearish momentum is continuing to drag price action even lower. The Dow Jones Industrial Average is trading at its lowest prices in nearly 26-weeks as the majority equity index tips over into bullish correction territory.
The Dow Jones is down 8.4% from record highs set last November just north of 45,000 as the current bear run heats up. Still, bullish pressure is beginning to cook as technical oscillators pin even deeper into oversold territory, flashing warnings of a topside correction. A supply zone between the 41,000 and 40,000 major price handles could provide a convenient landing zone for bears before the Dow recovers its footing for a fresh push higher.
Dow Jones daily chart
Tariffs FAQs
Tariffs are customs duties levied on certain merchandise imports or a category of products. Tariffs are designed to help local producers and manufacturers be more competitive in the market by providing a price advantage over similar goods that can be imported. Tariffs are widely used as tools of protectionism, along with trade barriers and import quotas.
Although tariffs and taxes both generate government revenue to fund public goods and services, they have several distinctions. Tariffs are prepaid at the port of entry, while taxes are paid at the time of purchase. Taxes are imposed on individual taxpayers and businesses, while tariffs are paid by importers.
There are two schools of thought among economists regarding the usage of tariffs. While some argue that tariffs are necessary to protect domestic industries and address trade imbalances, others see them as a harmful tool that could potentially drive prices higher over the long term and lead to a damaging trade war by encouraging tit-for-tat tariffs.
During the run-up to the presidential election in November 2024, Donald Trump made it clear that he intends to use tariffs to support the US economy and American producers. In 2024, Mexico, China and Canada accounted for 42% of total US imports. In this period, Mexico stood out as the top exporter with $466.6 billion, according to the US Census Bureau. Hence, Trump wants to focus on these three nations when imposing tariffs. He also plans to use the revenue generated through tariffs to lower personal income taxes.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD bounces off lows, retests 1.1370
Following an early drop to the vicinity of 1.1310, EUR/USD now manages to regain pace and retargets the 1.1370-1.1380 band on the back of a tepid knee-jerk in the US Dollar, always amid growing optimism over a potential de-escalation in the US-China trade war.
GBP/USD trades slightly on the defensive in the low-1.3300s
GBP/USD remains under a mild selling pressure just above 1.3300 on Friday, despite firmer-than-expected UK Retail Sales. The pair is weighed down by a renewed buying interest in the Greenback, bolstered by fresh headlines suggesting a softening in the rhetoric surrounding the US-China trade conflict.
Gold remains offered below $3,300
Gold reversed Thursday’s rebound and slipped toward the $3,260 area per troy ounce at the end of the week in response to further improvement in the market sentiment, which was in turn underpinned by hopes of positive developments around the US-China trade crisis.
Ethereum: Accumulation addresses grab 1.11 million ETH as bullish momentum rises
Ethereum saw a 1% decline on Friday as sellers dominated exchange activity in the past 24 hours. Despite the recent selling, increased inflows into accumulation addresses and declining net taker volume show a gradual return of bullish momentum.
Week ahead: US GDP, inflation and jobs in focus amid tariff mess – BoJ meets
Barrage of US data to shed light on US economy as tariff war heats up. GDP, PCE inflation and nonfarm payrolls reports to headline the week. Bank of Japan to hold rates but may downgrade growth outlook. Eurozone and Australian CPI also on the agenda, Canadians go to the polls.
The Best brokers to trade EUR/USD
SPONSORED Discover the top brokers for trading EUR/USD in 2025. Our list features brokers with competitive spreads, fast execution, and powerful platforms. Whether you're a beginner or an expert, find the right partner to navigate the dynamic Forex market.