(Bloomberg) -- Chief executives from steel and aluminum producers were landing in their corporate jets expecting a tariff announcement, but the battle inside the White House still raged.
President Donald Trump had told Commerce Secretary Wilbur Ross Wednesday he would end a months-long debate within the administration by imposing stiff tariffs on imports. Last-minute invitations went out to the CEOS late in the day to come to a White House event on Thursday.
But after news reports on the impending announcement late Wednesday night alerted opponents, the long-simmering split within the administration between economic traditionalists and trade warriors erupted into a roiling fight, pitting White House Chief of Staff John Kelly and Economic adviser Gary Cohn against Ross and Peter Navarro, a White House trade adviser.
The last-ditch counter-offensive produced a morning of confusion that whipsawed stocks and underscored passionate differences within the administration that are bound to resurface as the White House works its way through a full trade agenda and threats of retaliatory sanctions.
Early in the day, the administration’s protectionist wing’s victory seemed secure as White House aides told reporters a tariff announcement was coming. But by mid-morning, the ground had shifted and globalists appeared to have the upper hand.
Reporters were told an announcement would be postponed. The visiting industry executives, including ArcelorMittal USA’s John Brett, Nucor Corp.’s John Ferriola and Century Aluminum Co.’s Mike Bless, instead would meet with the president for a “listening session” on the issue.
The turnabout stunned some of the executives. Shares of U.S. Steel Corp., after rising more than 8 percent on news of the impending tariff by 10.32 a.m., plunged when the announcement was postponed, giving up almost the entire gain.
But Trump had a surprise in store, abruptly summoning reporters to join the meeting with industry executives, which was supposed to be closed to the press.
“We’ll be imposing tariffs on steel imports, and tariffs on aluminum imports,” Trump declared. “Some time next week we’ll be signing it in.”
Steel and aluminum producers’ shares bounced back, even as the rest of the market slumped as fears spread of an escalation of the administration’s hawkish trade agenda and a cycle of global retaliation.
The day’s drama mirrored previous behind-the-scenes maneuvering. Trump has previously made up his mind on steel and aluminum tariffs, only to have staff argue him into delaying, two people familiar with the matter said. Only this time, Trump dug in.
“Going to get the papers done now?” Trump asked Ross as reporters left the meeting with industry executives.
“Yes,” Ross replied.
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