Markets had dismissed tariff risks under the assumption that Trump would follow an earlier pattern and back off, in what became known as the so-called TACO trade. That allowed stocks to reach new record-high territory recently, marking a stunning rebound from the collapse triggered by his “Liberation Day” reciprocal tariffs in April.

The Dow, S&P 500 and Nasdaq retreat from record highs as President Trump rolled out a fresh tariff against Canada, following Brazil hit. Meanwhile, the Federal Reserve and Chairman Powell are under fire for spending on renovations.

Trump insiders maintain that it would make little sense — politically or from a policy standpoint — for the president to offer any further extensions on trade.

President Donald Trump has launched a fresh assault on global trading partners with Canada likely to be among the worst hit. In a letter sent to its northern neighbor late on Thursday, Trump said the U.