Wall Street in Storm: Markets Crash on Trump Tariff Blow
US stock markets crashed on Thursday, posting their most painful daily losses in years, as Donald Trump's unexpected and aggressive tariff maneuver unleashed a wave of panic on global markets.
A Sharp Turn from "Pro-Business" to Trade Barriers
Wall Street was enjoying a rebound not long ago, with markets hitting historic highs amid promises from the White House to support business activity. But now everything has changed. The US President announced the introduction of 10% tariffs on a wide range of imported goods, and for some countries the tariffs were even higher.
This step became an alarming signal for investors - it destroys international trade agreements and promises a large-scale economic conflict. In fact, we are talking about the beginning of a new global trade war.
Flight from stocks: investors seek refuge in bonds
Amid growing uncertainty, market participants began to urgently withdraw capital from stocks, transferring funds to safer assets, primarily government bonds. This reaction indicates a loss of confidence in the short-term stability of the stock market.
Volatility jumped sharply - the VIX index, which is often called the "fear barometer", soared to a three-week high.
The response was not long in coming: countries are preparing a counterattack
Washington risks finding itself in isolation. China has already promised to take retaliatory measures, and the European Union may face 20% tariffs, which only adds fuel to the fire. Meanwhile, Mexico, South Korea, India and other trading partners are taking a wait-and-see approach, hoping to reach an agreement before the tariffs go into effect on April 9.
Markets Under Pressure: Wall Street Slumps in Years
Thursday was a dark day for the U.S. stock market. The major stock indexes posted impressive declines, with the tech sector at the epicenter of the collapse.
According to preliminary estimates, the S&P 500 index fell 275.05 points, losing 4.85% of its value, to close at 5,395.92. The Nasdaq Composite showed an even more dramatic fall, down 1,053.60 points, or 5.99%, to 16,547.45. The Dow Jones Industrial Average also suffered losses, falling by 1,682.61 points or 3.98% to close at 40,542.71.
Technology under pressure: leaders are losing capitalization
The high-tech sector, which has long served as an engine of growth, is experiencing severe pressure. Apple shares sank after news of a total 54% tariff imposed on supplies from China, the country where most of the company's production facilities are concentrated. Giants Nvidia and Amazon were also in a bad way - both brands felt the effects of increasing pressure from US foreign economic policy.
The correction is not an accident, but a symptom of change
The stock market began to lose ground even after Donald Trump's inauguration. It is now becoming clear that January optimism has given way to anxiety: since the start of the presidential term, the S&P 500 and Nasdaq indices have already fallen by 10% from their recent record levels. Experts are talking about a "correction", but its causes lie much deeper - this is a reassessment of the economic risks caused by trade restrictions.
Hope for the Fed: markets are waiting for a rate cut
Against the backdrop of market turbulence, investors are increasingly inclined to think that the Federal Reserve will be forced to ease monetary policy. Analysts are already forecasting four cuts in the key interest rate during the current year, the first of which could happen as early as June - by 0.25 percentage points.
Industrial giants under fire as tariffs hit supply chains
The retail industry has found itself at the epicenter of the economic storm caused by new tariffs, with companies that rely on international manufacturing starting to suffer significant losses.
Nike and Ralph Lauren were among the first to feel the effects, with their supply chains in Vietnam, Indonesia, and China hit by fresh US tariffs. Now, globally oriented brands are facing a new logistics and pricing reality.
Banking sector shaken by uncertainty
The financial sector was also unable to resist. Major players including Citigroup, Bank of America, and JPMorgan Chase posted significant declines. Banks are traditionally sensitive to macroeconomic fluctuations, and the current environment has made investors question the resilience of the financial system as global conditions worsen.
Russell 2000 Signals: Domestic Signs of Trouble
The Russell 2000 Small Company Index also ended up in the red. This indicator, which reflects the health of domestic businesses, confirmed analysts' fears that the US economy is feeling internal stress, not just external pressure from tariffs.
Oil Giants Are Losing Footing: Falling Prices Are Putting Pressure on the Market
The largest representatives of the energy sector, Exxon Mobil and Chevron, were unable to stay afloat. Oil prices fell by 6.8%, which is associated not only with the escalation of trade tensions, but also with the increase in production by OPEC+ countries. The pressure on commodity assets is increasing, and this is affecting the entire chain: from producers to investors.
Island of Stability: Consumer Goods Show Resilience
Amid the collapse of the market, one sector remained afloat - essential goods. These companies are traditionally considered "safe havens" in times of instability. This time, the industry received additional support from Lamb Weston, whose financial results were better than expected, giving the sector a rare positive boost.
The Old Continent in the Red: Europe is heading into the Red Zone
European markets are also restless. By Friday morning, the pan-European STOXX index had lost 0.9%, bringing the weekly decline to 4.4% - the worst result since June 2022. The reaction is a direct consequence of the 20% tariffs on European imports announced by the United States.
Investors are looking at the outlook with concern: the threat of a global recession is becoming increasingly real. In response, pressure is growing on the European Central Bank, which is expected to make an emergency interest rate cut to prevent the economy from getting completely bogged down in stagnation.
Financial Front: European Banks Under Pressure
Amid growing fears of a global recession, the European banking sector has gone into deep negative territory. The region's banks index .SX7P posted the sharpest decline among sectors, down 3.8%, reflecting apprehension about future economic growth.
Experts say such losses are not just a reaction to external noise, but a direct reflection of growing concerns: if the trade war escalates, financial institutions will be the first to face an outflow of liquidity and rising credit risks.
Focus on America: Markets Hold Their Breath Ahead of Employment Data
The entire financial world is closely watching the US employment report for March, which is expected to be published at 12:30 GMT. This release is of key importance - it will show what state the world's largest economy was in before the tariff escalation began to destroy confidence in the future.
Investors are hoping for stable figures that will confirm the resilience of the US labor market. However, even a slight deviation from forecasts could increase panic sentiment amid growing geopolitical and economic risks.
Weak signals from Germany: Industry looking for a foothold
Friday's data from Germany did not inspire optimism: industrial orders in February remained at the same level, showing no growth. Although the January statistics were revised upward, the overall tone of the report suggests that the European industrial locomotive is still stalling.
Analysts believe that the industrial downturn may have bottomed out, but a rapid recovery is not to be expected. Too many external factors continue to hold back activity - from weak external demand to political turbulence.
Corporate turmoil: Gerresheimer loses ground as deal falls apart
Corporate stories have not been left out either. Shares in German pharmaceutical and cosmetics packaging specialist Gerresheimer fell 6% on news that investment giant KKR has pulled out of talks to potentially buy the company out of a private consortium.
The rejection came as a cold shower to investors who were expecting a major strategic move. The company's future now looks less certain, and the market was quick to react.
