The S&P 500 has officially entered correction territory, declining more than 10% from its recent peak. Investors are growing increasingly anxious over upcoming U.S. tariff announcements, sending global stock markets into a downward spiral.
Global Markets Plunge as Trade War Fears Intensify
Stock markets worldwide suffered heavy losses on Monday, with Tokyo leading the decline, plummeting over 4%. The uncertainty surrounding President Donald Trump’s proposed tariffs—set to be announced on April 2, dubbed “Liberation Day”—has rattled investors.
Kathleen Brooks, research director at XTB, stated, “There is an air of capitulation in financial markets ahead of the April 2nd reciprocal tariff announcement from the U.S.”
S&P 500 Falls Into Correction Territory
The S&P 500, which reached record highs just last month, has now declined by more than 10%. Initially, investors believed Trump’s tariff threats were a negotiation strategy. However, as his administration moves closer to imposing steep tariffs on major trading partners, concerns over inflation and potential recession are mounting.
Adding to the uncertainty, Trump recently declared that tariffs would apply to all countries, not just those with large trade imbalances with the U.S. This broad-sweeping approach has further shaken investor confidence.
Read More :- Indian Stock Market Closed Today for Eid-ul-Fitr: Trading Suspended on NSE & BSE
Market Volatility Surges
The CBOE Volatility Index (VIX), often called Wall Street’s “fear gauge,” spiked on Monday, reflecting heightened investor anxiety.
AJ Bell investment director Russ Mould commented, “Trump continues to be the key reason why markets are having a bad day. His threats to impose tariffs on all imports into the U.S. have created economic uncertainty worldwide.”
Automakers Bear the Brunt of New Tariff Threats
The auto industry was hit particularly hard following Trump’s announcement of a 25% tariff on all imported vehicles and parts.
- European Automakers: Porsche and Volkswagen both dropped more than 3%.
- Japanese Automakers: Toyota, Nissan, and Mazda saw similar declines.
- Asia-Pacific Impact: Moody’s Analytics noted that Japan and South Korea would face the harshest consequences, warning of “reduced production, declining orders, and shaken confidence.”
Gold Prices Surge as Investors Seek Safe-Haven Assets
With market instability rising, gold prices soared past $3,100 per ounce, hitting a new record high. Simultaneously, U.S. government bond yields fell as traders turned to safer investments.
Patrick O’Hare, an analyst at Briefing.com, explained, “Safe-haven trading is in full swing due to mounting concerns over U.S. trade policy.”
Company-Specific Impacts
- Moderna Stock Plunges: The pharmaceutical giant’s shares tumbled over 10% following news of a top FDA official’s resignation due to disagreements with Trump’s new health secretary, vaccine skeptic Robert F. Kennedy Jr.
- United Airlines Drops 4%: The airline’s stock fell after reports that Canadians were scaling back travel to the U.S. due to tariff tensions.
- CK Hutchison Falls 3.1%: In Hong Kong, the conglomerate saw declines amid concerns that a Chinese review of a major port operations deal could delay its finalization.
What’s Next for Investors?
With Trump’s tariff announcement looming, market volatility is expected to continue. Investors should prepare for potential short-term losses and monitor policy changes closely.
