Wall street’s main indices on Monday opened on a flat note as Trump issued a fresh threat against Mexico and the European Union. Trump announced a 30% tariff on both the EU and Mexico on Saturday, July 12. In the early hours of trading, the Dow Jones Industrial Average (.DJI), fell 126.24 points, or 0.28%, to 44,245.27, the S&P 500 (.SPX), lost 6.11 points, or 0.10%, to 6,253.64 and the Nasdaq Composite (.IXIC), gained 27.83 points, or 0.14%, to 20,613.36.

The tariff is set to be imposed from August 1. The tariffs for both Mexico and the EU were announced in separate letters through Trump’s Truth Social account. In his letter to Mexico, Trump stated, “Mexico has been helping me secure the border, BUT what Mexico has done is not enough.” Meanwhile, in his letter to the EU, Trump wrote. “We have had years to discuss our trading relationship with the European Union, and we have concluded we must move away from these long-term, large, and persistent trade deficits engendered by your tariff and non-tariff policies and trade barriers,” Trump wrote in the letter to the EU. “Our relationship has been, unfortunately, far from reciprocal.”

The European Union had initially aimed to secure a comprehensive trade deal with the United States for its 27-member bloc, looking forward to an agreement that would eliminate tariffs on industrial goods. However, after months of challenging negotiations and amid escalating trade tensions fuelled by President Trump’s tariff measures, the EU found itself preparing for a formal notice outlining new US duties. With hopes for a sweeping deal fading, officials now expect to settle for an interim agreement, holding out hope that a more robust pact can still be reached in the future.