US President Donald Trump has announced a counter -tariff on goods imported from 60 countries of the world. This new policy will be applicable from April 9. Trump’s decision has caused a huge stir in the global economy. After the announcement of the tariff, the US stock market collapsed badly, and this is said to be the biggest one -day decline since June 2020.
The total market cap of S&P 500 companies has fallen by $ 2.4 trillion, which shows the seriousness of the decision.
The atmosphere of tremendous selling in the market
-
Dow Jones Industrial Average fell 1400 points (3.3%) on Thursday
-
S&P 500 declined by 4%
-
Nasdaq Composite recorded a huge decline of 5.1%
-
Russell 2000 index declined by 5.9%, which took it down 20% from its record high level
This situation is considered to be the biggest decline after the March 2020 Kovid recession.
Deep concern among investors
The Trump administration has announced a ‘baseline tariff’ of 10% on most products.
This will affect companies that import goods from abroad and sell it in the US.
Countries affected by tariffs include:
-
United kingdom
-
Singapore
-
Brazil
-
Australia
-
New Zealand
-
Turkish
-
Columbia
-
Argentina
-
El Salvador
-
United Arab Emirates
-
Saudi Arabia
This has increased the risk of increasing inflation and slowing economic growth. The declaration of tariffs has affected not only the US but also on the stock markets of Europe and Asia.
Crude oil, technology stocks and gold -related investments have also seen a decline.
Danger of inflation and recession
Trump’s new tariff also includes large business partners like China and the European Union.
Experts have warned that:
-
This year the US economic growth rate may decrease by 2 percent
-
Inflation can again reach close to 5%
-
This situation can lead the economy to recession
Opinion of experts
Shaun Sun, the portfolio manager of Thornberg Investment Management, says: “The market has not yet fully understood how widespread the impact of Trump’s new tariff can be. If these rates are implemented, consumers will do less purchases around the world and the trade will slow down.”
The status of Federal Reserve (FED) has also become complicated:
-
If the interest rates reduce, the risk of rising inflation
-
If the rates do not decrease, economic lethargy can remain
On Wednesday, the yield of 10 -year -old American Treasury Bond declined from 4.20% to 4.04%, reflecting the market concern.
Airlines and retail sector shock
On Thursday, there was a severe decline in shares of many big companies:
-
Best Buy shares fell 15.2%
-
United Airlines lost 12.3%
-
10.3% declines in Target’s shares
Retail and aviation sectors have been the most affected as tariffs may reduce people’s spending capacity.
Trump’s tariff policy stir in global markets, impact in many countries including India
The post The US stock market declined drastically, the threat of global recession from Trump’s new tariff first appeared on News India Live | Breaking India News, The Indian Headline, India Express News, Fast India News.
