Trump’s decision to slap tariffs on Mexico hits stocks

President Trump’s decision to slap tariffs on Mexican goods rattled Wall Street on Friday, sending major stock indexes sharply lower in premarket trading.

The U.S. will impose a 5 percent tariff on incoming Mexican products as a result of large numbers of migrants crossing the nation’s southern border.

The tariff will go into effect on June 10, Trump said, while threatening to raise it further “until the Illegal Immigration problem” is resolved.

Futures for the Dow Jones Industrial Average were down 1.18 percent — nearly 300 points — and the S&P 500 was off 1.27 percent. Futures for the tech-heavy Nasdaq Composite were lower 1.64 percent.

The White House also released a statement from Trump, saying the country “has been invaded by hundreds of thousands of people coming through Mexico and entering our country illegally,” and the situation has had “profound consequences” for the U.S.

Shares of trade-dependent corporations, such as carmakers and semiconductor manufacturers, were being hit hard.

The yield on the 10-year Treasury fell to 2.15 percent — its lowest level in 20 months — signaling investor interest in relatively safe securities. The price and yield of bonds move in opposite directions.

Crude oil prices were down 2.33 percent to $55.27 per barrel.

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China’s Shanghai Composite closed down 0.24 percent, the Hang Seng was off 0.79 percent and Japan’s Nikkei 225 ended lower 1.63 percent.

Britain’s FTSE 100 fell 1.06 percent, the CAC 40 declined 1.54 percent and Germany’s DAX retreated 1.96 percent.