May 23 (Reuters) - U.S. stock index futures slid on Friday after President Donald Trump recommended 50% tariffs on the European Union, while Apple stock dropped after he warned that the company would have to pay tariffs if its phones were not made in the United States.
"The European Union, which was formed for the primary purpose of taking advantage of the United States on TRADE, has been very difficult to deal with," Trump said in a post on Truth Social.
He also said in a separate post prior to this that Apple (AAPL.O), would be subject to 25% tariffs if phones sold in the U.S. were not made within its borders. Apple's shares were down almost 4% in premarket trading.
At 08:08 a.m. ET, Dow E-minis were down 625 points, or 1.49%, S&P 500 E-minis were down 93.25 points, or 1.59%, and Nasdaq 100 E-minis were down 405 points, or 1.91%.
"The impact of tariffs for both sides on the surface is jolting... the market doesn't like uncertainty," said Andre Bakhos, managing member at Ingenium Analytics LLC.
"In the end, it will help the U.S. and other countries if we can get the EU at the table."
Other megacap and growth stocks turned sharply lower, with Amazon (AMZN.O), and Nvidia (NVDA.O), sliding more than 2% each.
Wall Street's "fear gauge", the CBOE Volatility Index (.VIX), spiked to a more than two-week high and was last at 24.6 points.
Risk sentiment had remained in check after the Republican-controlled U.S. House of Representatives passed the sweeping tax and spending bill that would enact much of Trump's policy agenda by a narrow margin on Thursday. The bill now heads to the Senate, which Republicans control 53-47, for approval.
If it becomes a law, it will add about $3.8 trillion to the federal government's $36.2 trillion debt in the next decade, according to the nonpartisan Congressional Budget Office.
Long-dated government bond yields eased on Friday, with those on the 10-year note off 9 basis points to 4.46%.
All three main stock indexes were set for modest weekly losses as worries about mounting debt pushed Treasury yields higher. Moody's downgrade of the U.S. credit rating late last week had initially sparked concerns.
Trading activity is expected to thin on Friday, heading into a long weekend, as markets will be shut on Monday for Memorial Day.
Reporting by Shashwat Chauhan and Kanchana Chakravarty in Bengaluru; Editing by Pooja Desai
