12:45 PM EDT, 06/02/2025 (MT Newswires) -- US equity indexes were mixed at midday on Monday as a souring of international trade policy developments undermined risk sentiment.

The Dow Jones Industrial Average fell 0.6% to 42,029.9, the S&P 500 dropped 0.2% to 5,901.5, but the Nasdaq Composite rose 0.2% to 19,146.3. Consumer discretionary, industrials, and real estate led the underperformers intraday, while energy was the biggest gainer.

President Donald Trump and Chinese President Xi Jinping are likely to speak this week, CNBC cited a senior White House official in a news report on Monday. This comes as US Treasury Secretary Scott Bessent last week spoke about the need for a conversation between the two leaders, saying trade discussions between the two largest economies in the world have "stalled."

Following Bessent's comments, Trump announced Friday plans to double tariffs on US imports of steel and aluminum to 50%. The move amplified concern and uncertainty, according to a note from D.A. Davidson. The expanded import duty will come into effect on Wednesday, according to a note from Scotiabank.

The European Commission said Saturday that Europe is preparing to retaliate. "This decision adds further uncertainty to the global economy and increases costs for consumers and businesses on both sides of the Atlantic," Reuters cited a European Commission spokesperson.

China responded to the US allegations that Beijing is cheating on the Geneva trade agreement by accusing the United States of violating the Swiss pact by applying tighter controls on artificial intelligence chips and canceling Chinese student visas, according to the Scotiabank note.

"If the US insists on its own way and continues to damage China's interests, China will continue to take resolute and forceful measures to safeguard its legitimate rights and interests," a Yahoo Finance news report cited the Chinese Ministry of Commerce on Monday.

Meanwhile, Canada's Chamber of Commerce said the tariffs harmed North America's economic stability. "Unwinding the efficient, competitive, and reliable cross-border supply chains like we have in steel and aluminum comes at a great cost to both countries," Reuters cited Candace Laing, president of the chamber, in a news report.

"The main risk-off catalyst [in markets on Monday] is pessimism toward trade policy developments," Derek Holt, head of capital market economics at Scotiabank, said in the note.