Global stocks are slower after China’s sharp rise in tariffs amid the escalating trade war between U.S. President Donald Trump. There is even no expected report on the U.S. job market, which is usually the economic highlight every month, enough to stop the slide.
The S&P 500 fell 2.8% in early trading, its worst day since Covid-19 destroyed the global economy in 1920. The Dow Jones industrial average fell 2.6%, and the Nasdaq composite rate fell 3.2% as of 9:35 a.m. ET.
Canada’s major stock index S&P/TSX has fallen 2.96% as of 9:40 a.m. ET.
So far, there are few winners in the financial markets in the trade war. The biggest loss of European stocks on the day, the index fell by more than 3.5%. Crude oil prices fell to their lowest levels since 2021.
Other basic growth bases (such as copper) have also seen sharp drops in prices, which will weaken the global economy as a whole.
China’s response to U.S. tariffs has resulted in immediate acceleration of losses in global markets. Beijing’s Commerce Department said it would impose a 34% tariff on the U.S. imports of all U.S. products starting April 10 to deal with the 34% tariff on U.S. imports to China.
The United States and China are the two largest economies in the world.
Better than expected work report
The market recovered some losses after Friday morning’s U.S. jobs report, which said employers’ hiring accelerated last month exceeded economists’ expectations. This is the latest signal for the U.S. job market in early 2025, and it has remained stable, which is the key to pulling the economy out of the recession.
But employment data is looking backwards, and fear hitting financial markets is about what is about to happen. Will the trade war lead to a global recession? If so, stock prices may need to lower prices even beyond them. The S&P 500 index fell nearly 15% from its February record.
After Trump’s tariff shock
Much depends on how long Trump’s tariffs last and the revenge of other countries. Some on Wall Street are still insisting that Trump will lower tariffs after he negotiates with other countries to pry some “victories”. Otherwise, many people say that a recession looks likely.
Trump has said that Americans may feel “somewhatful” because of the tariffs, but he also said that long-term goals, including bringing more manufacturing jobs back to the United States, are worth it. On Thursday, he compared the situation to the medical surgery for the U.S. economy.
“For investors looking at their portfolios, it may feel like a surgery without anesthesia,” said Brian Jacobsen, chief economist at Annex Wealth Management.
But Jacobson also said the next surprise for investors may be the slowdown in tariffs. “The speed of recovery will depend on how the officials negotiate and how fast they are,” he said.
Despite global stock market selloffs and concerns about a global recession, U.S. President Donald Trump and his allies are defending his “liberation day” tariffs. Trump said he believes “going well” and the country will soon seek a deal.
Vietnam said its deputy prime minister would visit the U.S. for talks on trade, while the head of the European Commission vowed to fight back. Others said they hope to provide relief with the Trump administration.
Stocks plummeted after China Mobile
On Wall Street, stocks of companies that operate a lot in China fell to some of the biggest losses.
Last year, GE Healthcare received 12% of revenue from China, down 17.9% as the biggest loss in the S&P 500 index. United Airlines’ alliance with Air China, lost 8.1% of its passenger revenue last year from Pacific flights.
Dupont fell 12.1% after China said regulators were conducting an antitrust investigation into Dupont China Group, a subsidiary of chemical multinational corporations. This is one of several measures against U.S. companies’ retaliation against U.S. tariffs.
In the bond market, fiscal yields continue to drop sharply with concerns about the strength of the U.S. economy, and expectations for Fed to lower interest rates to mitigate interest rates increased.
From 4.06% in the second half of Thursday, the yield at the beginning of the year fell below 4% from 4.06% to below 3.92%. This is a major move in the bond market.
In foreign stock markets, Germany lost 3.9% of DAX, France’s CAC 40 fell 3.6% and Japan’s Nikkei 225 fell 2.8%.
