Global stock markets tumble to begin week as Trump remains committed to tariffs

The Associated Press

· Posted: Apr 07, 2025 8:22 AM EDT | Last Updated: 28 minutes ago

Global banal markets extended a terrible plunge Monday, fuelled by fears that U.S. tariffs would pb to a planetary economical slowdown. European and Asian shares saw melodramatic losses, the starring U.S. scale flirted with carnivore marketplace territory successful pre-market trading, and lipid prices sagged. 

The monolithic sell-off successful riskier assets astatine the commencement of the trading week follows President Donald Trump's announcement of sharply higher U.S. import taxes and retaliation from China that saw markets autumn sharply Thursday and Friday. 

Late Sunday, Trump reiterated his resolve, saying, "sometimes you person to instrumentality medicine to hole something." 

WATCH l Trump defiant contempt the marketplace reaction:

U.S. futures signalled further weakness ahead. For the S&P 500, they mislaid 3.4 per cent, portion for the Dow Jones Industrial Average, they shed 3.1 per cent. Futures for the Nasdaq mislaid 5.3 per cent. 

Some countries, South Korea and Pakistan among them, said they were sending commercialized officials to Washington soon to effort to seek clarity.

However, Germany's system minister, Robert Habeck, was defiant arsenic helium arrived astatine a gathering of European Union commercialized ministers successful Luxembourg, saying the premise of the wide-ranging tariffs was "nonsense" and that attempts by idiosyncratic countries to triumph exemptions haven't worked successful the past. 

It's important for the EU to instrumentality together, helium said. That "means being wide that we are successful a beardown presumption — America is successful a presumption of weakness."

Trump has justified the tariffs arsenic a substance of addressing American commercialized deficits — which astir economists say is not a motion of economical wellness successful and of itself. In the lawsuit of Canada and Mexico, helium has sought to usage tariffs to effort to curb the travel of fentanyl into the U.S., adjacent though cause interdictions from Canada into the U.S. are comparatively low.

JPMorgan Chase CEO Jamie Dimon, successful his much-read yearly enactment to shareholders aboriginal Monday, cautioned investors that the turmoil caused by U.S. tariffs and a planetary commercialized warfare could dilatory maturation successful the world's largest economy, spur ostentation and perchance pb to lasting antagonistic consequences.

"The quicker this contented is resolved, the amended due to the fact that immoderate of the antagonistic effects summation cumulatively implicit clip and would beryllium hard to reverse," the CEO wrote.

JPMorgan's economists raised the hazard of a U.S. and planetary recession this twelvemonth to 60 per cent from 40 per cent aft Trump unveiled the steepest commercialized barriers successful much than 100 years past week.

Dimon successful January said critics of Trump's tariffs needed to "get implicit it," though helium did let astatine the clip they would person to beryllium implemented carefully.

Flirting with carnivore territory

If the pre-market futures losses materialize erstwhile the U.S. marketplace opens, the S&P 500 volition participate carnivore marketplace territory — defined arsenic a autumn of much than 20 per cent from the peak. The scale was disconnected 17.4 per cent arsenic of the extremity of past week. 

The U.S. Federal Reserve could cushion the stroke of tariffs connected the American system by cutting involvement rates, which Trump successful a societal media station aboriginal Monday argued for. That tin promote companies and households to get and spend. But Fed seat Jerome Powell said Friday that the higher tariffs could thrust up expectations for ostentation and little rates could substance inactive much terms increases. 

LISTEN l Bloomberg podcast big Joe Weisenthal connected the tariff tumult:

On Friday, the worst marketplace situation since the COVID-19 pandemic shifted into a higher cogwheel arsenic the S&P 500 plummeted six per cent and the Dow plunged 5.5 per cent. The Nasdaq composite dropped 3.8 per cent. 

"There's nary motion yet that markets are uncovering a bottommost and opening to stabilize," wrote Deutsche Bank analysts successful a probe note.

Chinese markets often don't travel planetary trends, but they besides tumbled. Hong Kong's Hang Seng dropped 13.2 per cent, portion the Shanghai Composite scale mislaid 7.3 per cent. In Taiwan, the Taiex plummeted 9.7 per cent, portion South Korea's Kospi mislaid 5.6 per cent.

On Monday, Beijing struck a enactment of assurance adjacent arsenic markets successful Hong Kong and Shanghai tumbled. The People's Daily, the Communist Party's authoritative mouthpiece, had beardown words. 

"The entity won't fall," it declared, adjacent if the U.S. tariffs person an impact. "Faced with the indiscriminate punches of U.S. taxes, we cognize what we are doing and we person tools astatine our disposal," it added.

Oil prices plummet

Middle East banal markets tumbled Monday arsenic they struggled with the dual deed of the United States' caller tariff argumentation and a crisp diminution successful lipid prices.

Benchmark Brent crude is down by astir 15 per cent implicit the past 5 days of trading, with a tube of lipid costing conscionable implicit $63 US. That's down astir 30 per cent from a twelvemonth ago.

That outgo per tube is acold little than the estimated break-even terms for Saudi Arabia and astir different countries producing vigor successful the Middle East. That's coupled with the caller tariffs, which saw the Gulf Cooperation Council states of Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the United Arab Emirates deed with 10 per cent tariffs. 

"With these measures and the expected retaliatory measures that could beryllium adopted by different countries, the stableness and predictability of planetary commercialized could beryllium undermined," the accounting steadfast PwC said successful an advisory to its Mideast clients.

Tokyo's Nikkei 225 scale closed down 7.8 per cent. European shares followed Asian markets lower, led by Germany's DAX index, which concisely fell much than 10 per cent astatine the unfastened connected the Frankfurt exchange, but recovered immoderate crushed to determination down 5.8 per cent successful greeting trading.