On Monday, global stock markets plunged again. However, the spotlight remained on how U.S. businesses brace for tariff fallout. President Donald Trump’s decision to double down on import tariffs triggered another round of investor panic.
Asian markets opened with sharp losses. Japan’s Nikkei 225 fell nearly 8% shortly after trading began. It closed down 7.8%. South Korea’s Kospi index dropped 5.6%. Meanwhile, Australia’s ASX 200 slipped 4.2%, recovering slightly after deeper early losses.
Soon after, European shares mirrored the steep decline. Germany’s DAX lost more than 10% before recovering part of its losses. France’s CAC 40 and Britain’s FTSE 100 also fell around 5% in early trading.
Even so, the sharpest concern came from Wall Street. Futures for the S&P 500 dropped 3.4% before the opening bell. The Nasdaq fell even more, losing 5.3%. Dow Jones futures also declined by over 3%.
If losses continue, the S&P 500 may soon enter a bear market. That would mean a drop of more than 20% from recent highs. Currently, it is down 17.4%.
U.S. businesses brace for tariff fallout as markets fail to find solid ground. Deutsche Bank analysts noted no signs of stabilization yet. Meanwhile, President Trump, speaking from Air Force One, defended the tariff hikes. He claimed they are necessary medicine to fix trade problems.
These tariffs range from 10% to 50% on imported goods. China responded by raising its own tariffs on U.S. products. This tit-for-tat move intensified fears of a prolonged trade war.
Oil prices also declined sharply. U.S. crude fell $2.30, landing at $59.69 per barrel. Brent crude slipped $2.33 to $63.25. Analysts linked the drop to reduced fuel demand from slower economic growth.
Currency markets also reacted. The U.S. dollar weakened against the yen, which investors often consider a safe haven. The euro slightly rose, reflecting instability in the dollar’s value.
Investment experts warned of more volatility. Nathan Thooft from Manulife predicted countries would continue retaliating. He emphasized the long timeline needed for trade negotiations.
In response to market chaos, the Federal Reserve may cut interest rates. Yet, inflation risks could limit how far rates can fall.
Still, many investors remain hopeful. Some believe Trump may scale back tariffs if other nations offer concessions. Citi strategist Stuart Kaiser warned that earnings don’t yet reflect the full tariff impact.
In the end, U.S. businesses brace for tariff fallout with no clear end in sight. Markets remain uncertain, and fears of a recession grow stronger by the day.
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