US stocks rebounded Monday after falling sharply due to Donald Trump’s latest tariff threats. The former president plans to introduce new import taxes on steel, aluminum, vehicles, and all Chinese imports. He calls Wednesday “Liberation Day” for the US economy.
His aggressive trade stance has raised fears of a global trade war. Uncertainty over the tariff details led to sharp market declines over the past month.
Market Reactions to Trump’s Tariff Plans
Since mid-February, the S&P 500 dropped nearly 10%, making March the worst month in years. The Nasdaq fell more than 10%, marking its weakest quarter since 2022.
Global markets also reacted negatively:
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Japan’s Nikkei 225 fell over 4%.
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South Korea’s Kospi dropped 3%.
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UK’s FTSE 100 lost 0.9%.
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Germany’s DAX declined 1.3%.
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France’s CAC 40 fell 1.6%.
However, US shares recovered slightly Monday:
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The Dow Jones gained 1%.
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The S&P 500 rose 0.5%.
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The Nasdaq dropped only 0.1%.
Trump’s Shifting Tariff Policy Creates Confusion
Trump’s messaging on tariffs has been unclear. He previously hinted that some countries could get exemptions. But over the weekend, he suggested a universal approach.
Speaking aboard Air Force One, Trump told reporters, “You’d begin with all countries… essentially everyone under consideration.”
Governments Prepare for Retaliation
The UK government believes the tariffs will impact British exports. Officials are considering retaliatory trade actions. A spokesman for the prime minister said talks with US trade officials were “constructive,” but a deal would not be reached before Wednesday.
Canada and the European Union have already announced plans to counter US tariffs. This raises concerns about a new wave of trade disputes. Some economists warn that these actions could push the US toward a recession.
Gold Prices Hit Record Highs Amid Economic Fear
Investors turned to gold, seen as a safe investment during economic uncertainty. Prices hit a record $3,128.06 per ounce.
Shanti Kelemen, Chief Investment Officer at M&G Wealth, said uncertainty is high due to Trump’s unpredictable policy shifts. She noted that Japan could face serious economic harm. “They dominate car production and semiconductors, and both could be targeted next,” she warned.
Tariffs Could Change Jobs, Prices, and Business Profits
Trump sees tariffs as a way to protect US industries and negotiate stronger trade deals. A White House report claimed that a 10% tariff on all imports could create three million new jobs.
Trump’s trade advisor, Peter Navarro, estimated that the tariffs could generate $600 billion per year—about one-fifth of total US imports.
However, businesses warn that the tariffs could raise prices for American consumers.
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If companies pass the costs to customers, inflation could rise.
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If businesses absorb the costs, profits could suffer.
Companies Rethink US Operations
Will Butler-Adams, CEO of Brompton Bicycle, said new tariffs could force his company to change its US strategy. His bikes have not yet been targeted, but he fears future competitiveness will suffer.
“If tariffs hit, we won’t invest the same way,” he said. “We might even reduce or exit.”
He also noted that complex customs rules make it hard to calculate existing tariffs.
“Even customs officials don’t always understand how some tariffs apply,” Butler-Adams said.
TikTok Faces Final Hours Before US Ban
In separate news, Trump confirmed that TikTok must be sold by April 5 or face a US ban. This deadline was set under a law passed during Biden’s presidency. ByteDance, TikTok’s Chinese parent company, has until Saturday to sell.
The outcome of this deal could impact US-China relations further.