On April 2, former President Donald Trump announced new tariffs, significantly impacting market uncertainty. Initially, Bitcoin surged due to the announcement of a 10% fixed tariff, but a selling wave soon followed.
How Will US Tariffs Affect the Market?
Trump's announcement of a 10% fixed tariff on exports from countries like China and Japan led S&P 500 futures to drop by over 3%. Companies linked to international trade were hit hardest. Notably, Apple's stock fell by nearly 7%, while other major exporters like Amazon and Tesla recorded declines exceeding 4%.
Is a Global Trade War on the Horizon?
The tariff announcement has raised concerns about the potential onset of a global trade conflict. While no retaliatory measures have been declared yet, the risk remains if countries choose to respond in kind. US officials have warned against such actions, highlighting serious repercussions.
Market Reactions to New Tariffs
Following the tariff declaration, there has been a shift toward safe-haven assets. Yields on ten-year bonds reached their lowest in five months. Gold prices surged to an unprecedented $3,164 before settling in the $3,100 range. Additionally, Brent crude oil futures experienced a decline of over 4%.
Recent developments surrounding tariffs and their ramifications across multiple sectors underscore the delicate balance of global trade relationships and the unpredictable nature of market responses.
