LIVE MARKETS-From Tesla to tourism: How global boycotts, travel drop could hurt US GDP growth

Welcome to the home for real-time coverage of markets brought to you by Reuters reporters. You can share your thoughts with us at markets.research@thomsonreuters.com

FROM TESLA TO TOURISM: HOW GLOBAL BOYCOTTS, TRAVEL DROP COULD HURT US GDP GROWTH

A drop in foreign tourism, boycotts of U.S. goods, particularly across Canada and Europe, and shifting global consumer sentiment towards the U.S. due to President Donald Trump's tariffs could weigh on U.S. economic growth, Goldman Sachs said.

The Wall-Street brokerage projected a pullback in demand from boycotts of U.S. food, autos, and other consumer goods as well as tourism could lower U.S. GDP by 0.1%.

Trump has imposed tariffs on its top trading partners, including Canada, and he is expected to announce 'reciprocal' tariffs' on Wednesday, which has fueled fears of a global economic slowdown.

"The bigger issue is a pullback in tourist visits to the US, which account for 0.7% of US GDP," said Goldman. It estimated that foreign tourist arrivals to major U.S. airports declined 11% on an annual basis following recent tariff threats.

Tourists from the EU and Canada, in particular, spend about $50 billion annually (0.2% of U.S. GDP) on visits to the U.S., Goldman estimates.

The impact on U.S. multinational corporations revenue could be larger if foreign consumers lower spending on U.S. brands that are produced abroad, which in turn could be a drag on GDP of between 0.2%-0.3%, Goldman warned.

"Foreign boycotts of US products will likely impose a modest drag on US GDP, mostly due to a pullback in foreign tourism," Goldman added.

Global consumers have downgraded their opinions of U.S. brands, especially those linked to President Trump like Tesla TSLA.O.

That was evident as Tesla's sales in key European markets fell again in March, data showed on Tuesday, adding to signs that drivers are shunning Elon Musk's electric car brand as competition from China stiffens and some protest against his political views.

Separately, a Bank of America Institute's report on Monday showed U.S. consumers are pulling back on domestic travel with a weaker start to the year than in the previous two years, which may offer a warning for the sector and for the economy.

(Akriti Shah and Siddarth S)

FOR TUESDAY'S EARLIER LIVE MARKETS POSTS:

VOLTAGE RISE: GERMANY'S FISCAL BOOST TO CRANK UP ITS POWER SECTOR - CLICK HERE

U.S. STOCKS MIXED EARLY TUESDAY, BRACE FOR TRUMP TARIFFS- CLICK HERE

AT THE QUARTER POLE, LOW VOLATILITY SETS THE PACE - CLICK HERE

UK TO AVOID RECIPROCAL TARIFFS BUT GROWTH TO FALL ANYWAY - GOLDMAN - CLICK HERE

LIBERATION DAY QUESTIONS: WHO AND WHAT? HOW HIGH? HOW LONG? - CLICK HERE

STOXX REBOUNDS FROM NEAR 2-MONTH LOWS - CLICK HERE

BEFORE THE BELL: EUROPE EYES TENTATIVE BOUNCE AS Q2 STARTS - CLICK HERE

A DEEP BREATH BEFORE 'LIBERATION DAY' - CLICK HERE