June 2 (Reuters) - U.S. stock index futures dipped on Monday following President Donald Trump's plans to double tariffs on imported steel and aluminum, fueling more uncertainty around U.S. trade policies.
Trump said on late Friday he planned to increase tariffs on imported steel and aluminum to 50% from 25% starting Wednesday, just hours after he accused China of violating an agreement.
Shares of U.S. steel companies rose in premarket trading, with Cleveland-Cliffs (CLF.N),jumping 25.6%, Nucor (NUE.N),up 10.6% and Steel Dynamics (STLD.O),11.4% higher.
However, shares of U.S. automakers fell with Ford (F.N),down 0.8% and General Motors (GM.N),losing 1.1%.
The increased levies risk deepening Trump's global trade war, and doused enthusiasm in markets stemming from the U.S. president's softer trade stance that drove a recovery in risky assets last month.
A temporary relief on some levies on China and a rollback of steep tariff threats on the European Union, along with strong earnings and improving economic picture helped the benchmark S&P 500 log its best monthly performance in 18 months in May.
"It is really hard to keep up or predict what's going to happen on trade at the moment, and that's before we factor in the full ramifications from the court ruling last Thursday night, and then subsequent brief stay of execution for them on appeal," Jim Reid, global head of macro and thematic research at Deutsche Bank, said in a note.
A federal appeals court on Thursday temporarily reinstated most of Trump's 'Liberation Day' tariffs blocked a day prior to that by the Court of International Trade.
"For now, it seems likely that the tariff uncertainty will linger for a long time ahead even if we're still likely past the peak aggressiveness of U.S. policy," Reid said.
At 7:34 a.m. ET, Dow E-minis were down 85 points, or 0.2%, S&P 500 E-minis were down 18.25 points, or 0.31%, and Nasdaq 100 E-minis were down 95 points, or 0.44%.
Most megacap and growth stocks were down, with Tesla (TSLA.O), leading losses after it reported lower monthly sales in Portugal, Denmark and Sweden. The stock was last down 1.5%.
Focus will be on comments from Federal Reserve Chair Jerome Powell later in the day as he presents opening remarks before the Federal Reserve Board International Finance Division's 75th anniversary conference at 1:00 p.m. ET (1700 GMT).
Fed Governor Christopher Waller said on Monday that interest rate cuts remain possible later this year even with the Trump administration's tariffs likely to push up price pressures temporarily.
On the data front, a reading of S&P Global U.S. manufacturing PMI is due at 9:45 a.m. ET and ISM's manufacturing activity index is scheduled for 10:00 a.m. ET.
Investors are also looking ahead to a crucial nonfarm-payrolls report on Friday to gauge the U.S. labor market's strength amid tariff volatility.
Among other stocks, Moderna (MRNA.O),rose 2.1% after the U.S. Food and Drug Administration approved its next-generation COVID-19 vaccine for everyone aged 65 and above.
Blueprint Medicines (BPMC.O),advanced 26.8% after French drugmaker Sanofi (SASY.PA),to buy the biopharma group for up to $9.5 billion.
Boeing (BA.N),rose 1.6% after BofA Global Research upgraded the planemaker's stock to "buy" from "neutral".
Reporting by Kanchana Chakravarty and Sukriti Gupta in Bengaluru; Editing by Maju Samuel
