Market Turmoil as Trump’s Tariffs Trigger Global Sell-Off

Image Source : Krish Capital Pty Ltd

Index Update

Dow and S&P 500 futures fell over 2% and 3%, respectively, while Nasdaq 100 futures plunged more than 4%. Companies with global supply chains suffered sharp declines, with Apple down 7.5%, Nike 7%, and Tesla 7.2%. Mega-cap tech stocks and retailers also saw significant losses. Trump’s tariffs included a 34% levy on Chinese goods (totaling 54%), a 20% duty on the EU, and steep tariffs of 46%-49% on Vietnam and Cambodia.

Market Movers

On Wednesday, the top gainers were TTEC Holdings, Inc. (+27.52%), followed by AngioDynamics, Inc. (+13.25%). On the contrary BingEx Limited (-60.12%) and        nCino, Inc (-32.97%) declined the most the same day.

Commodities Update

Oil prices fell nearly 3% on Thursday, with WTI dropping to around $69 per barrel and Brent below $73, as risk aversion grew following President Trump’s higher-than-expected tariffs. While energy imports were exempt, tariffs on China (34%), the EU (20%), and other nations raised concerns about trade disputes affecting global demand. A surprise rise in U.S. crude inventories and Russia’s tighter export restrictions added to the bearish sentiment. Investors now await the OPEC+ meeting for supply outlook insights.

Gold initially hit a record high above $3,160 per ounce before easing below $3,130, driven by Trump’s broad tariff measures, including a 25% levy on foreign-made cars. Expectations of rate cuts, central bank purchases, and strong ETF demand provided support. Markets now look to the upcoming U.S. non-farm payrolls report for further signals on Federal Reserve policy.

Macro Update

The US 10-year Treasury yield fell to 4.08%, its lowest since mid-October, as Trump’s new tariffs sparked a flight to safety. The tariffs include a 10% baseline on all imports, with higher rates for China (34%), Europe (20%), and Japan (24%). Trump defended the move, citing foreign trade barriers. The announcement raised recession fears, leading traders to increase bets on Fed rate cuts, now expecting three to four cuts this year, with the first likely in June.

Futures Update

U.S. stock futures dropped sharply after President Trump announced sweeping trade tariffs, raising fears of a global recession. Dow, S&P 500, and Nasdaq futures fell significantly. The new tariffs include a 10% levy on all imports, with higher rates for certain countries—China faces an additional 34%, while the EU, Japan, and others see tariffs ranging from 20% to 49%. Trump defended the move as a response to unfair trade practices. Analysts warned of increased economic uncertainty, with some predicting a potential 10% hit to U.S. GDP in the second quarter, heightening recession risks.

Stocks bounced back from an early slump on Wednesday, closing mostly higher and extending the gains made in the previous session. The major indices climbed significantly off their lows, finishing the day solidly in positive territory. Although the major averages experienced some selling in early afternoon trading, they regained upward momentum as the day progressed. The Nasdaq advanced by 151.16 points, or 0.9 percent, to close at 7,601.05, while the S&P 500 rose by 37.92 points, or 0.67 percent. The S&P 500 has retraced from support levels and is currently hovering near immediate resistance, as noted at the beginning of the week. This situation suggests the possibility of further downside in the near term, with support identified around 5,504 and resistance at 5,712. Additionally, the 14-period RSI is approaching its midpoint, indicating a potential pullback ahead.