US STOCKS-Wall Street mixed after Trump's steel tariff threat

By Kanchana Chakravarty and Sukriti Gupta

June 2 (Reuters) - Wall Street's main indexes were mixed on Monday after President Donald Trump said he plans to double tariffs on imported steel and aluminum, fueling more uncertainty around U.S. trade policies.

Trump said late on 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, with Cleveland-Cliffs CLF.N jumping 23.6%, Nucor NUE.N up 9.2% and Steel Dynamics STLD.O 10.1% higher.

However, shares of automakers fell. Ford F.N was down 4.3% and General Motors GM.N was 4.7% lower.

"It's the continued uncertainty, not knowing whether the trade war is on or it's off," said Sam Stovall, chief investment strategist at CFRA Research.

"Something new gets added, something gets postponed, so essentially it is that uncertainty reigns."

The increased levies risk deepening Trump's global trade war, and dousing 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.

Also fueling risk-off moves in global markets, Kyiv struck some of Moscow's nuclear-capable bombers on Sunday, renewing concerns around further escalation of the war.

At 11:49 a.m. ET, the Dow Jones Industrial Average .DJI fell 196.92 points, or 0.47%, to 42,073.15, the S&P 500 .SPX lost 9.21 points, or 0.16%, to 5,902.48 and the Nasdaq Composite .IXIC gained 17.73 points, or 0.09%, to 19,131.49.

Seven of the 11 major S&P 500 sub-sectors fell, with consumer discretionary .SPLRCD declining the most with a nearly 1% fall. On the flip side, energy .SPNY rose over 1% tracking a rise in oil prices.

U.S.-listed energy stocks advanced after producer group OPEC+ kept output increases in July at the same level as the previous two months.

Most megacap and growth stocks fell, with Tesla TSLA.O, down 2.8% after it reported lower monthly sales for Portugal, Denmark and Sweden. Google-parent Alphabet GOOGL.O also lost 1.7%.

The Institute for Supply Management's (ISM) survey showed U.S. manufacturing contracted for a third straight month in May and suppliers took longer to deliver inputs amid tariffs, potentially signaling looming shortages of some goods.

Dallas Federal Reserve Bank President Lorie Logan said that with the labor market stable, inflation running somewhat above target and the outlook uncertain, the central bank is keeping a watchful eye on a broad range of data to judge what response might be needed, and when.

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).

Traders currently see at least two 25 basis points of cuts by the end of the year, according to data compiled by LSEG.

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.

Declining issues outnumbered advancers by a 1.6-to-1 ratio on the NYSE and by a 1.09-to-1 ratio on the Nasdaq.

The S&P 500 posted 14 new 52-week highs and four new lows, while the Nasdaq Composite recorded 69 new highs and 67 new lows.