Stocks Shake Off Tariff Threat After Trump Extends Deadline

July 8, 2025

The president noted that U.S. negotiators remained open to offers from trading partners, suggesting that tariffs could be reduced by — or even after — the deadline on Aug. 1.

Stock markets mostly rose on Tuesday after President Trump revived steep tariffs on dozens of countries but extended their start date to Aug. 1, signaling that talks would continue between his trade negotiators and their counterparts around the world. He later noted that the deadline in August was “not 100 percent firm,” reinforcing that his administration was “open” to offers from trading partners.

The S&P 500 rose slightly in early trading. Indexes in Japan and South Korea, major U.S. trading partners who are facing 25 percent tariffs, also gained. Stocks in Europe were mixed, but the moves were generally modest.

The market movements were the latest example of how Mr. Trump’s on-again, off-again trade proclamations have driven the markets this year. Analysts pointed out that market declines linked to fears of steep tariffs have often given way to rallies as deadlines are relaxed.

“Rightly or wrongly, investors think they know what happens from here,” Chris Beauchamp, the chief market analyst at IG Group, wrote on Tuesday. “Either negotiations result, and a ‘deal’ of some sort (usually in the vaguest terms) is announced, allowing Trump to claim a win, or a fresh extension to the deadline is announced.”

In Japan, a recent market wobble has been called the “Yaskawa Shock.” Yaskawa Electric, a leading global manufacturer of industrial robots, forecast on Friday that it expected profits to fall this year, a contrast to the 20 percent year-on-year gain it had previously projected.

Yaskawa, heavily reliant on sales in the United States and China, had issued its earlier financial outlook before accounting for the effects of U.S. tariffs. The company reports results earlier than many other big Japanese firms and was looked at as an early indicator of upcoming earnings. The new U.S. tariffs are expected to erase around 5 percent of profit at big Japanese companies this year, according to analysts at SMBC Nikko, but the effect on markets was predicted to be “limited,” they wrote on Tuesday, as the tariff rate proposed by Mr. Trump this week was similar to the one he initially floated in April.

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