Global financial markets are facing significant turbulence following the Trump administration’s sweeping tariffs on imports from major trading partners including China, the EU, and Canada. Tariff rates now range from 10% to as high as 104%, sparking concerns of a global economic downturn.
In the U.S., the Dow Jones dropped over 1,600 points—its sharpest fall since 2020—while the S&P 500 and Nasdaq also plummeted. Similar losses were seen in Asia, with Japan’s Nikkei 225 diving nearly 8%. European luxury goods firms have also been hit hard, with sector forecasts downgraded from 5% annual growth to a 2% decline.
Investor confidence is shaken. Goldman Sachs has raised the likelihood of a U.S. recession to 45%, while JPMorgan predicts a 0.3% contraction next quarter. Larry Summers warned the tariffs could lead to 2 million job losses if they remain in place.
Global responses vary. The EU is considering a “zero-for-zero” deal to ease tensions, Canada has slapped tariffs on U.S. car imports, and South Korea has set up a $2 billion fund to support its auto sector. Meanwhile, industries such as luxury fashion and IPO markets in London are bracing for prolonged uncertainty.
In short, Trump’s aggressive trade stance has rocked markets worldwide, with fears growing that escalating tensions could tip the global economy into recession.
