Tariff Fears Return as Nasdaq Dips

U.S. tariffs may not be paused as long as expected, as Trump threatens to levy a 50% tax against the European Union.

Timothy St. John•Monday, May 26, 2025•2 min read

The European Union is in Trump's tariff crosshairs.

Quick overview

President Trump is threatening new tariffs on the European Union, reigniting investor concerns over trade issues.
The stock market has reacted negatively, with the Nasdaq down 1% and Apple shares falling 3.02%.
The U.S. National debt is also a growing concern, with a new budget plan potentially increasing it by $3.8 trillion over the next decade.
Investors are worried that the trade war may escalate again, impacting market stability as Memorial Day approaches.

Investors believed they would get a break from tariff worries for a while, but now President Donald Trump is threatening to issue levies toward the European Union in his latest move.

Trump is levying new taxes against products from the European Union.

The European Union and Apple are both in President Trump’s crosshairs this week, as he has spoken about enacting levies against them. This has brought the issue of tariffs back on the table and caused the stock market to decline once more. The Nasdaq is down 1% ahead of trading hours on Monday. Apple (APPL) is one of the stocks hit the hardest with a 3.02% decrease.

The Dow Jones dropped 0.61% after the news broke, and the S&P 500 fell 0.67%. In addition to declining stock indices, the U.S. National debt problem has forced its way to the forefront of investing fears, as a new budget plan could end up increasing the debt by $3.8 trillion over the next decade.

Treasury yields are also rising, even as the dollar diminishes, and Japan’s bond yields are on the rise as well. All of these factors could lead to a diminishing of U.S. assets, causing a tightening of the U.S economy.

Will the Trade War Continue?

It looks like Trump is not done with his tariff plans, even changing the game during the 90-day pause on the severest tariffs. This has given economists and investors reason for concern. The fragile stock market has become even more fragile as a result, and now investors worry that they may not get an actual break from tariffs for the foreseeable future.

The trade war has escalated, then settled down, and now is escalating again. That news is what will push investments this week starting off with the long holiday weekend for Memorial Day. The newly proposed tariffs include a 50% tariff on countries in the European Union. All Apple iPhones made outside the U.S. but sold within its borders will be taxed with a 25% penalty.

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ABOUT THE AUTHOR See More

Timothy St. John

Financial Writer - European & US Desks

Timothy St John is a seasoned financial analyst and writer, catering to the dynamic landscapes of the US and European markets. Boasting over a decade of extensive freelance writing experience, he has made significant contributions to reputable platforms such as Yahoo!Finance, business.com: Expert Business Advice, Tips, and Resources - Business.com, and numerous others. Timothy's expertise lies in in-depth research and comprehensive coverage of stock and cryptocurrency movements, coupled with a keen understanding of the economic factors influencing currency dynamics. Timothy majored in English at East Tennessee State University, and you can find him on LinkedIn.