Global markets rattled amid broad tariffs: S&P 500 futures sink 3%
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Investor sentiment took a sharp hit overnight as U.S. President Donald Trump formally announced sweeping tariffs on imports from 180 countries, triggering immediate volatility across global equity and currency markets. Futures tied to the S&P 500 dropped approximately 3% in after-hours trading, reflecting market concerns that the escalation in protectionist policy could severely undermine global economic growth.
China bore the brunt of the measures, with an additional 34% tariff layered on top of the existing 20% levy—bringing total charges on Chinese imports to 54%. The new policy directly targets key Chinese export sectors, including automobiles, electronics, and chemicals. The European Union was not spared, receiving a blanket 20% tariff on its exports to the U.S. Trump characterized the measures as “kind reciprocal tariffs,” claiming they mirror the EU’s treatment of U.S. goods. However, data from the World Trade Organization contradicts this narrative, indicating that over 70% of EU imports are duty-free,with average tariffs around 2.7%.
The announcement prompted immediate condemnation. European Commission President Ursula von der Leyen emphasized that the EU remains open to dialogue but warned of retaliatory actions if necessary. China’s Ministry of Commerce denounced the move as “unilateral bullying” and confirmed that Beijing is preparing strong countermeasures. The tariffs are scheduled to come into effect on April 9.
Markets reacted swiftly. Equities across Asia and Europe sold off heavily, with technology, industrial, and financial sectors leading losses. Currency markets saw the U.S. dollar weaken, while EUR/USD climbed nearly 1% to trade above 1.0930. Risk aversion also spilled into commodities and digital assets, with both gold and Bitcoin experiencing notable declines.
The fear is that this policy shift may echo the dynamics of the 1930s, when aggressive tariff regimes exacerbated the global economic downturn. Investors are now pricing in the risk of a synchronized slowdown, coupled with a potential inflationary shock that could undermine recent central bank efforts to stabilize prices. With few details on exemptions or timelines for future escalation, markets will remain highly sensitive to any additional communication from Washington or retaliatory announcements from U.S. trading partners.
China bore the brunt of the measures, with an additional 34% tariff layered on top of the existing 20% levy—bringing total charges on Chinese imports to 54%. The new policy directly targets key Chinese export sectors, including automobiles, electronics, and chemicals. The European Union was not spared, receiving a blanket 20% tariff on its exports to the U.S. Trump characterized the measures as “kind reciprocal tariffs,” claiming they mirror the EU’s treatment of U.S. goods. However, data from the World Trade Organization contradicts this narrative, indicating that over 70% of EU imports are duty-free,with average tariffs around 2.7%.
The announcement prompted immediate condemnation. European Commission President Ursula von der Leyen emphasized that the EU remains open to dialogue but warned of retaliatory actions if necessary. China’s Ministry of Commerce denounced the move as “unilateral bullying” and confirmed that Beijing is preparing strong countermeasures. The tariffs are scheduled to come into effect on April 9.
Markets reacted swiftly. Equities across Asia and Europe sold off heavily, with technology, industrial, and financial sectors leading losses. Currency markets saw the U.S. dollar weaken, while EUR/USD climbed nearly 1% to trade above 1.0930. Risk aversion also spilled into commodities and digital assets, with both gold and Bitcoin experiencing notable declines.
The fear is that this policy shift may echo the dynamics of the 1930s, when aggressive tariff regimes exacerbated the global economic downturn. Investors are now pricing in the risk of a synchronized slowdown, coupled with a potential inflationary shock that could undermine recent central bank efforts to stabilize prices. With few details on exemptions or timelines for future escalation, markets will remain highly sensitive to any additional communication from Washington or retaliatory announcements from U.S. trading partners.