Stock futures fell on Friday, a day after the S&P 500 hit a record high. The day before, U.S. President Donald Trump announced a 35% tariff on Canada and threatened to raise tariffs across the board.

Futures on the Dow Jones Industrial Average

fell 294 points, or 0.7%. Futures tied to the S&P 500

fell 0.6% after the benchmark hit an intraday record high and a record close on Thursday. Nasdaq 100 futures

fell 0.6%. The Nasdaq Composite also hit a record high on Thursday.

Trump cited fentanyl as a reason to increase tariffs on Canada, adding that tariffs would increase further if Canada retaliated. "If Canada works with me to stop the flow of fentanyl, we may consider adjusting this letter," Trump said in a letter posted on the Truth Social website.

Trump then said he planned to impose across-the-board tariffs of 15% to 20% on the remaining countries, higher than the current standard of 10% that investors have become accustomed to.

"I think these tariffs were very well received. The stock market hit new highs today," Trump said Thursday.

Traders are also awaiting a trade update from Trump this week on the European Union, but it's unclear whether the president will issue a letter with new tariffs, as he did with Canada, or simply update on progress in ongoing deal talks.

The S&P 500 rose 0.3% on Thursday to a new high, while the tech-heavy Nasdaq closed up 0.1% as investors shrugged off concerns about the latest trade developments, including a 50% U.S. tariff on copper imports and a 50% tariff on Brazil announced this week. Nvidia's market value has surged to $4 trillion, driven by promising prospects for artificial intelligence, driving the recent stock market gains.

Nvidia, like most other tech stocks, retreated in premarket trading Friday. The stock market was hit by a broad sell-off on Friday, with most S&P 500 components falling in early trading. JPMorgan Chase led the decline in bank stocks on Friday, falling about 1% in premarket trading.

Drew Pettit, Citigroup’s head of U.S. equity strategy, warned that the economy needs to continue to be resilient for the rebound to be sustainable.

“Structurally, we’re not there yet. Fundamentally, I don’t think we’re there yet,” he said Thursday. “If you want these types of sectors to continue to outperform and not just trade tactically, you need macro data support and the Fed to cut rates. It’s not an either/or question. Structurally, I think it’s both, and we’re not quite there yet.”

Friday’s decline could put the major indexes in the red for the week. Next week, investors need to deal with the start of the second-quarter earnings season and the release of some key inflation data.