BREAKING NEWS Five new Covid-19 cases reported in Shasta County Saturday Full Story
BREAKING NEWS Mission Fire burns structure in Tehama County Full Story

Wall Street braces for tariffs after Gary Cohn resignation

Wall Street is preparing for steep tariffs as Gary Cohn leaves the White House.The Dow fell sharply on Wednesd...

Posted: Mar 9, 2018 8:50 AM
Updated: Mar 9, 2018 8:50 AM

Wall Street is preparing for steep tariffs as Gary Cohn leaves the White House.

The Dow fell sharply on Wednesday -- by as much as 349 points. It recovered some of those losses for a while, but selling accelerated at midday.

The White House announced after the markets closed Tuesday that Cohn, President Trump's top economic adviser, was resigning. He disagreed with Trump's planned tariffs on foreign steel and aluminum.

"His departure has caught investors off guard," said Alec Young, FTSE Russell's managing director of global markets research.

Investors were holding out hope that Trump would soften his vow to impose a tariff of 25% on imported steel and 10% on aluminum. Wall Street fears broad tariffs will be the opening salvo in a trade war that could damage the economy.

Cohn's resignation "signals that the Trump administration is absolutely going to move forward with tariffs and the risk of a trade war is now more elevated," said Chris Zaccarelli, chief investment officer at Independent Advisor Alliance.

Related: Gary Cohn's exit stokes fears that Trump will fight a trade war

Brad McMillan, chief investment officer for Commonwealth Financial Network, said the prospect of tariffs will "hurt business and investor confidence, which are two of the pillars holding up the markets."

Cohn, a former Goldman Sachs president, helped design Trump's tax cuts and was one of the administration's leading proponents of free trade. He served as a calming influence on the market.

"He was seen as the voice of economic stability and a spokesperson for financial markets. His resignation leaves the president with a set of economic advisors largely seen as outside of the mainstream, or at least perceived as less aligned with Wall Street interests," said McMillan.

Trump's tariff announcement last week shook Wall Street and led to backlash from top US trading partners, including Canada and the European Union.

The markets recovered on Monday and Tuesday, as investors gained confidence that House Speaker Paul Ryan and other top Republicans would soften Trump's position on tariffs. Cohn's resignation leaves one less voice in the White House to push back.

Ryan Detrick, senior market strategist for LPL Financial, said trade will "continue to be a source of increased market volatility" as more details emerge about the tariffs.

NAFTA talks are also looming in the background. Trump has threatened to tear up the 1994 trade agreement between the United States, Canada and Mexico. The three countries have made little progress on a re-negotiated deal since beginning talks in August.

-CNN's Matt Egan contributed to this report.

California Coronavirus Cases

Data is updated nightly.

Confirmed Cases: 318761

Reported Deaths: 7027
CountyConfirmedDeaths
Los Angeles1303943795
Riverside24765537
Orange23901421
San Diego19371422
San Bernardino18912304
Fresno790687
Imperial7827135
Alameda7725148
Kern633997
San Joaquin627968
Santa Clara5983166
Tulare5678152
Sacramento533981
Stanislaus463351
Contra Costa460589
San Francisco442650
Ventura424653
San Mateo3949112
Santa Barbara393131
Marin343430
Kings289839
Monterey254018
Solano207528
Merced188412
Sonoma165014
Placer105511
San Luis Obispo9054
Madera8938
Yolo83928
Santa Cruz5683
Napa4774
Sutter3724
Butte3384
San Benito3362
El Dorado3070
Lassen2750
Shasta1876
Yuba1803
Humboldt1654
Glenn1640
Nevada1631
Colusa1130
Mendocino1130
Lake1081
Tehama1041
Calaveras670
Tuolumne640
Del Norte600
Mono501
Siskiyou410
Amador400
Inyo341
Mariposa311
Plumas170
Alpine20
Trinity20
Sierra10
Unassigned00
Chico
Clear
93° wxIcon
Hi: 104° Lo: 68°
Feels Like: 93°
Oroville
Clear
93° wxIcon
Hi: 105° Lo: 67°
Feels Like: 93°
Paradise
Clear
93° wxIcon
Hi: 97° Lo: 69°
Feels Like: 93°
Chester
Clear
83° wxIcon
Hi: 87° Lo: 57°
Feels Like: 83°
Red Bluff
Clear
97° wxIcon
Hi: 105° Lo: 71°
Feels Like: 97°
Willows
Clear
93° wxIcon
Hi: 107° Lo: 65°
Feels Like: 93°
There is a Red Flag Warning in Modoc county today and tomorrow with temperatures getting as hot as 110 degrees for some in the Valley by Wednesday.
KHSL Severe
KHSL Radar
KHSL Temperatures

Community Events