S&P 500 Declines by $2.4 Trillion After Trump Introduces Tariffs

The world’s markets changed in a split second. The S&P 500 index saw a drop of more than $2.4 trillion in market value. Losing this much wealth in a single day has not occurred for the S&P since March 2020. The market sell-off was caused by the global tariffs imposed by the former US President, Donald Trump.

Why Did The Market Crash?

Trump stated that alongside the new 10% import tax, the US would also charge Chinese imports an additional 64%, Japanese Imports would pay 24% and the EU an additional 20% on their goods. This proposal incites additional fears of a global trade dispute which might trigger a recession.

Market Responses:

– The Nasdaq Composite dramaticaly declined by 5.9%
– The Dow Jones Industrial Average also saw a drop of 4%
– The US Dollar Weakens and Gold Prices Surge as investors turn towards Safe-haven assets.

Worries Around The World Economies

As time goes by, economists are beginning to warn us for the risk of stagflation. Countries that are facing the new tariffs might retaliate and that poses a greater threat to economic stagnation and disruption in the supply chains.

Furthermore, a day before markets open, speculation is always high and this drives both investors and decision-makers to monitor for any possible changes that lessen the expected economic volatility.

Read More:

Trump’s New Tariff Plan Sparks Global Economic Concerns.
Canada and UK Explore Major Power Link.