By South China Morning Post | Created at 2025-04-03 14:29:48 | Updated at 2025-04-04 10:15:07
20 hours ago
Financial markets around the world were reeling on Thursday following US President Donald Trump’s latest and most severe volley of tariffs, and the US stock market may be taking the worst of it.
The S&P 500 was down 3.3 per cent in early trading, worse than the drops for other major stock markets. The Dow Jones Industrial Average was down 1,160 points, or 2.7 per cent, as of 9.32am Eastern time, and the Nasdaq composite was 4.5 per cent lower.
Little was spared as fear flared globally about the potentially toxic mix of higher inflation and weakening economic growth that tariffs can create. Prices fell for everything from crude oil to Big Tech stocks to small companies that invest only in US real estate. Even gold, which has hit records recently as investors sought something safer to own, pulled lower. The value of the US dollar also slid against other currencies, including the euro and Canadian dollar.
Investors worldwide knew Trump was going to announce a sweeping set of tariffs late on Wednesday, and fears surrounding it had already earlier pulled the S&P 500 10 per cent below its all-time high. But Trump still managed to surprise them with “the worst case scenario for tariffs”, according to Mary Ann Bartels, chief investment officer at Sanctuary Wealth.
Trump announced a minimum tariff of 10 per cent on imports from all countries, with the tax rate running much higher on products from certain countries like China and those from the European Union. It is “plausible” the tariffs altogether, which would rival levels unseen in roughly a century, could knock down US economic growth by 2 percentage points this year and raise inflation close to 5 per cent, according to UBS.
