- US stock futures rose after Trump’s commerce secretary hinted at tariff compromises with Canada and Mexico.
- Trump reimposed 25% tariffs on Canada and Mexico after pausing it for a month.
- Markets closed lower for a second consecutive day as Nasdaq and S&P 500 saw significant declines.
US stock futures ticked back up after a sharp fall, following Commerce Secretary Howard Lutnick’s comments on Fox Business on Tuesday afternoon that President Donald Trump could announce tariff compromises with Canada and Mexico as early as Wednesday.
Trump reimposed 25% tariffs on imports from Canada and Mexico, a plan that was paused for a month and then came into effect early Tuesday morning. The tariffs were imposed over allegations that the neighboring countries were failing to stem the flow of drugs and crime into the US.
Lutnick’s remarks came as US markets staggered and closed lower for a second consecutive day. The Nasdaq composite slipped 0.4%. During the day, it briefly reached a 10% decline from its most recent closing high. The S&P 500 fell 1.2%, wiping out all post-election gains since last November.
Lutnick said talks with Canada would likely reduce some of the newly reimposed tariffs on imports from the two neighboring countries.
“Both the Mexicans and the Canadians are on the phone with me all day today, trying to show that they’ll do better,” Lutnick said, adding that Trump is “listening” and open to a middle-ground solution.
Canada has also swiftly responded with 25% of retaliatory tariffs. Canadian Premier Doug Ford announced Tuesday that he will cancel a $100-million deal with Starlink and remove US alcohol from shelves. He also threatened a 25% surcharge on electricity that Ontario sends to 1.5 million Americans.
Meanwhile, Mexican President Claudia Sheinbaum said retaliatory measures are “going to wait” because she planned to speak to Trump this week.
While details of the compromise remain unclear, Lutnick said it will likely not be another tariff pause but a more long-term deal.
Trump is addressing Congress Tuesday night, with trade policy likely to be a key topic.
