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Global stock markets experienced a dramatic sell-off on Monday as investors reacted to the latest surge in US tariffs, raising fears of a potential global economic slowdown. European and Asian shares plummeted sharply, while US futures signaled the risk of a bear market, and oil prices also slid.
The widespread market decline follows US President Donald Trump’s announcement of significantly higher import taxes, combined with retaliatory measures from China last Thursday and Friday. Tokyo’s Nikkei 225 dropped nearly 8% shortly after the opening bell, with futures trading for the index even being temporarily suspended, ultimately closing 7.8% lower at 31,136.58.
European markets mirrored the downturn. Germany’s DAX index, which fell more than 10% at the opening on the Frankfurt exchange, managed a partial recovery only to finish the morning 5.8% lower. Similarly, Paris’ CAC 40 declined by 5.8%, and Britain’s FTSE 100 dropped 4.9% during the European session.
In the United States, pre-market futures indicated further weakness, with the S&P 500 losing 3.4%, the Dow Jones Industrial Average dropping 3.1%, and Nasdaq futures falling by 5.3%. Should these losses persist at market open, the S&P 500 could breach the bear market threshold—defined as a decline of more than 20% from its peak—especially after ending last week down 17.4%.
This sell-off builds on Friday’s severe market downturn—the worst since the COVID-19 pandemic—when the S&P 500 fell 6%, the Dow dropped 5.5%, and the Nasdaq declined 3.8%. Deutsche Bank analysts noted in a research report that there were no clear signs of stabilization or a bottom forming.
Reiterating his commitment to the tariffs, Trump, speaking from Air Force One on Sunday, remarked, “sometimes you have to take medicine to fix something,” dismissing concerns that his policies were intended to trigger market declines. Heavy selling ensued after China matched Trump’s tariffs last Friday, intensifying fears of an escalating trade war that could spiral into a global recession. Even a stronger-than-expected US jobs report failed to stem the slide.
“The uncertainty about how these tariffs will ultimately play out is really driving the plummet in stock prices,” said Rintaro Nishimura, an associate at Asia Group.
Asian markets bore the brunt of the turmoil as well. Hong Kong’s Hang Seng Index tumbled 13.2% to 19,828.30, the Shanghai Composite dropped 7.3% to 3,096.58, and Taiwan’s Taiex fell 9.7%. South Korea’s Kospi declined 5.6% to 2,328.20, while Australia’s ASX 200 slid 4.2% to 7,343.30, recovering slightly from an earlier loss of over 6%. These losses are particularly concerning for Asian economies, which are heavily reliant on exports to the US market.
“Beyond the market meltdown, the bigger concern is the impact on small, trade-dependent economies,” warned Gary Ng of Nataxis, emphasizing the need for Trump to reach at least partial tariff deals with other countries soon.
Oil prices also fell as market sentiment soured, with US benchmark crude dropping by $2.30 to $59.69 per barrel and Brent crude declining by $2.33 to $63.25 per barrel, amid concerns that slowed economic growth would dampen fuel demand. This drop came as OPEC+ nations increased production to counterbalance the decline.
Currency markets experienced volatility as well; the US dollar weakened against the Japanese yen, falling to 146.24 yen from 146.94, while the euro inched up by 0.3% to $1.0992.
Nathan Thooft, chief investment officer at Manulife Investment Management, predicted that additional countries might retaliate with their own tariffs, although he expects negotiations to be prolonged. “Market uncertainty and volatility are likely to persist for some time,” he noted.
While the Federal Reserve might offset some of the economic impact by lowering interest rates to boost borrowing and spending, Fed Chair Jerome Powell warned that lower rates could further stoke inflationary pressures already heightened by the tariffs.
Ultimately, much will depend on how long Trump’s tariff policy remains in place and how other nations respond. Some investors are holding onto hope that, after securing concessions from other countries, Trump might eventually ease the tariffs. Meanwhile, Citi’s head of US equity strategy, Stuart Kaiser, pointed out that current earnings estimates and stock valuations have not yet fully accounted for the potential downside of the unfolding trade conflict.
At least 69 people have died and almost 150 injured following a powerful 6.9-magnitude earthquake off the coast of Cebu City in the central Visayas region of the Philippines, officials said, making it one of the country’s deadliest disasters this year.
A tsunami threat was issued in Chile after a magnitude 7.8 earthquake struck the Drake Passage on Friday. The epicenter was located 135 miles south of Puerto Williams on the north coast of Navarino Island.
The war in Ukraine has reached a strategic impasse, and it seems that the conflict will not be solved by military means. This creates a path toward one of two alternatives: either a “frozen” phase that can last indefinitely or a quest for a durable political regulation.
A shooting in Nice, southeastern France, left two people dead and five injured on Friday, authorities said.
Snapchat will start charging users who store more than 5GB of photos and videos in its Memories feature, prompting backlash from long-time users.
Germany’s Adidas increased its full-year profit guidance, saying it managed to cushion some of the extra expenses resulting from higher U.S. tariffs.
Germany’s Adidas on Tuesday raised its full-year operating profit forecast, saying it had successfully offset part of the additional costs caused by higher U.S. tariffs.
New Zealand's annual inflation accelerated in the third quarter, reaching 3.0%, which aligns with analysts' expectations and is at the upper end of the central bank's target range, according to official data released on Monday.
On Sunday, the Netherlands' Economy Minister, Vincent Karremans, stated that he expects to meet with a Chinese government official in the coming days to discuss how to resolve the standoff over Nexperia NV, a computer chip maker whose issues are threatening global automotive supply chains.
In the first nine months of this year, 10.2 billion cubic metres of gas were produced from the Azeri-Chirag-Gunashli (ACG) block in the Azerbaijani sector of the Caspian Sea, according to operational data released by the Ministry of Energy.
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