Traders on the floor of the New York Stock Exchange experienced a significant market selloff, marking the worst such event in five years. This upheaval in the financial markets has accompanied widespread concern among both investors and consumers regarding the potential impacts of President Trump’s tariff policies on the global economy.
The decline in U.S. stocks persisted into Friday, following a particularly rough day on Thursday for the stock markets. As of late Friday morning, the Dow Jones Industrial Average had decreased by over 1,400 points or approximately 3.4%, building on a 1,700-point drop the previous day. Other indices, such as the Nasdaq and S&P 500, which include the largest U.S. companies, also saw significant losses, each falling more than 4% on Friday morning.
President Trump’s unexpected announcement on Wednesday stated that nearly all U.S. imports would be subject to new tariffs. The imposition of these taxes affects both allies and rival countries, with most imports facing a minimum of a 10% tariff. Higher taxes are being applied to imports from the European Union, Japan, China, and several other countries.
The situation intensified on Friday with a response from China, which imposed a 34% reciprocal tariff on all U.S. imports. Other countries are also expected to retaliate, heightening the global trade dispute.
Economic experts express concerns that these new tariffs could lead to increased prices and a deceleration in economic growth within the United States, with consequences likely spilling over internationally. JPMorgan, an investment bank, raised its global recession probability to 60%, citing fears of a recession triggered by the tariffs.
Businesses across sectors have reacted with surprise and discontent regarding the increased costs posed by these tariffs, which they and their consumers are expected to bear. Consumer spending had already been decelerating, with consumer confidence hitting a low point. A positive jobs report released on Friday, indicating that more jobs were added than anticipated last month, was not enough to assuage widespread concerns about the economic future post-tariffs.
