Wall Street took a dramatic downturn just one day after what former President Trump dubbed “Liberation Day,” as financial markets responded sharply to his sweeping new tariff strategy.
Stocks plummeted on Thursday, following Trump’s announcement of a large-scale tariff rollout designed to match what he described as unfair trade practices by other nations—a move that investors fear could spark a full-blown global trade war.
The Dow Jones Industrial Average dropped a staggering 1,679 points, equivalent to a 4% slide, marking its worst single-day performance since the onset of the COVID-19 crisis in 2020.
The S&P 500 fell by 4.84%, while the Nasdaq experienced a steep 6% drop, after Trump declared new tariffs of at least 10% on all imports and even steeper levies on specific countries. These announcements came after markets had closed on Wednesday.
“This was the worst-case scenario for tariffs and were not priced into the markets, which is why we are seeing such a risk-off reaction,” said Mary Ann Bartels, chief investment strategist at Sanctuary Wealth, in a statement.
“We’re expecting rocky markets for the next few months, and through the end of the first half of the year,” she continued.
Appearing on Fox News’ “Fox & Friends” Thursday morning, Vice President JD Vance acknowledged the potential economic pain but defended the policy shift, saying he’s not going to “shy away” from the immediate impact the tariffs may have on Americans, and stressing the country is in need of a “big change.”
Businesses dependent on Chinese manufacturing faced sharp losses as a result of the newly announced trade measures.
Apple, which manufactures most of its iPhones in China, saw its shares fall 9.25% after Trump announced a punishing 34% tariff on Chinese imports, pushing the cumulative tariff on the country to 54% with earlier levies included.
Although Apple has been working to diversify production by expanding in countries like Vietnam and India, that strategy took a hit as Trump imposed new tariffs of 46% on Vietnam and 26% on India.
Intel stock saw some volatility, dipping as much as 3.7% before finishing the day up 2%. In contrast, Qualcomm tumbled 9.51% by the close of trading.
Big tech took a broad hit during the selloff—Nvidia dropped 7.8%, Tesla sank 5.47%, and Amazon shares slumped 9%.
Footwear companies that rely heavily on Vietnamese manufacturing were also hit hard. Nike, in particular, recorded a major drop of 14.44%, leading the losses among sneaker brands like Adidas and Puma.
As markets reacted to the tariff plan, the U.S. Dollar Index fell 2.1%, while the euro surged 2.4%, marking what could be the euro’s most significant single-day rise since 2015.
In response to the shifting currency dynamics, Citi recommended investors go long on the euro and projected the dollar could slide to its lowest point since October 2021.
The 10% general tariff Trump announced is roughly three times higher than the average U.S. import duty prior to his presidency, and it is scheduled to go into effect at 12:01 a.m. on Saturday.
Additional targeted tariffs that exceed the 10% base rate are expected to roll out after midnight on April 9, allowing a brief window for diplomatic discussions with countries that may seek exemptions.
But the lack of clarity around how negotiations will unfold has only heightened investor anxiety.
“While we have made it past Liberation Day, there is still no clarity on tariffs, as President Trump has complete discretion on adjusting these tariffs and the ability to create carve-outs as he sees fit,” wrote David Bahnsen, chief investment officer at the Bahnsen Group.
“For a stock market that was craving certainty, there is now even more ambiguity than before this announcement.”
{Matzav.com}