Trump’s aggressive tariff move shakes markets
Aboard Air Force One on Sunday, Trump announced plans to impose tariffs on all nations that have offered less favorable trade terms to the United States. Though the president assured that the measures would be “more generous”, the looming uncertainty has spooked investors. With a Wednesday deadline for the announcement, volatility is expected to persist in the coming days.
Market Performance
- Dow Jones Industrial Average: Dropped 500 points, a 0.3% decrease.
- S&P 500: Fell 1% to a six-month low.
- Nasdaq Composite: Declined 2%, also reaching a six-month low.
Sector Impact
- Technology Stocks: Companies like Nvidia and Tesla saw significant losses.
- Cryptocurrency-Linked Stocks: Shares of Coinbase and Riot Platforms declined following a drop in bitcoin prices below $84,000.
Safe-Haven Assets
- Gold: Surged to a record high of $3,160 per ounce as investors sought safety amid economic fears.
- U.S. Treasury Bonds: Yields fell as demand increased, reflecting a shift towards safer investments.
Global Market Reaction
- Japan’s Nikkei 225: Dropped 4%.
- South Korea’s Kospi: Fell 3%.
- France’s CAC 40: Decreased by 1.6%.
Economic Outlook
- Recession Probability: Goldman Sachs increased the likelihood of a U.S. recession within the next 12 months to 35%.
- Inflation Concerns: Tariffs are expected to raise consumer prices, contributing to stagflation fears.
Global markets react: How are other nations affected?
The selloff extended to Asian and European markets. In Asia, Japan’s Nikkei 225, South Korea’s Kospi, and Taiwan’s Taiex fell, dragged down by semiconductor sell-offs. European indexes also retreated, with mining, banking, and automotive sectors leading the decline.
Recession worries surge as analysts weigh in
With escalating fears, Goldman Sachs now estimates a 35% chance of a U.S. recession, echoing concerns voiced by JPMorgan and Moody’s. Analysts warn that Trump’s broad tariff plan could disrupt global trade, potentially pushing the U.S. and world economies into recession.
Gold prices soar, treasury yields slip as investors seek safe havens
As panic spread, investors turned to safe-haven assets. Gold futures surged to record highs, gaining 20% in 2025, marking the best quarterly performance since 1986. Similarly, yields on 10-year U.S. Treasury notes dipped to 4.2%, reflecting a rush to safer investments.
Bitcoin holds firm while oil prices defy expectations
In contrast to falling stocks, Bitcoin hovered around $83,000, maintaining stability. Meanwhile, oil prices rose despite economic concerns, fueled by fears that Trump’s proposed actions could disrupt Russian crude supplies and tighten the global oil market.
What lies ahead as tariff deadline approaches?
With Wednesday’s deadline fast approaching, uncertainty looms large. Analysts warn that aggressive trade policies could create lasting economic turbulence, further rattling markets and potentially destabilizing global economies. Investors are bracing for another volatile week as they await Trump’s formal announcement.
FAQs:
Why did the stock market fall after Trump’s tariff threats?
The threat of global tariffs raised fears of an economic downturn, prompting a market sell-off.
How did gold and oil prices react to the market uncertainty?
Gold surged to record highs, while oil prices climbed despite global recession fears.
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