Donald Trump's Reciprocal Tariffs Trigger Over 5% Drop in US Stock Market, Fueling Global Recession Fears; Impacts Markets Worldwide, Including India.
Stock Market Crash: Former US President Donald Trump's announcement of a reciprocal tariff policy on Friday sent shockwaves through the American stock market. Following this decision, major indices like the Dow Jones, S&P 500, and Nasdaq experienced declines exceeding five percent. This sharp downturn has intensified investor concerns about a potential global recession.
Among History's Largest Drops
The Dow Jones index plummeted by over 5.50 percent, considered one of the largest single-day drops in recent years. The S&P 500 fell approximately 6 percent, while the Nasdaq witnessed a significant 5.73 percent decrease. Market expert Ajay Bagga notes that since Trump's presidency, US markets have lost approximately $9 trillion in market capitalization.
Impact of Tariffs on the US Economy
According to a report by "Ask Private Wealth," reciprocal tariffs like these could exacerbate economic uncertainty in the United States. Experts warn this move could trigger stagflation—a combination of recession and inflation—in the US. The report also suggests that Trump's trade policies could raise trade barriers to levels not seen since the 19th century.
Global Market Impact
The impact of Trump's tariff policy wasn't confined to the US; global markets also felt the repercussions. Britain's FTSE 100 index closed down approximately 5 percent, mirroring the decline seen in Germany's DAX index. Asian markets, particularly India, also experienced noticeable effects.
Indian Markets Decline
India's stock markets were not immune to this global pressure. The Sensex fell by 930 points, closing at 75,364, representing a 1.22 percent drop. Similarly, the Nifty declined by 345 points, closing at 22,904, a decrease of approximately 1.5 percent. Intraday, the Sensex saw a drop of over 1,000 points before partially recovering.
Impact of Tariffs on India and Other Countries
The Trump administration announced this policy under the banner of a "fair and reciprocal trade policy," stating that the US would now impose equal tariffs on all countries that impose import duties on US goods. This policy could significantly affect several trade partners, including India.
