The Wall Street reference points collapsed on Thursday, ending with the largest percentage losses of one day since 2020, since the radical tariffs of the president of the United States, Donald Trump, lit the fears of a total commercial war and a global economic recession.
The Dow Jones index of the United States has fallen more than 1,680 points, almost four percent.
Investors fled as risky assets, seeking the safety of government bonds, after Trump applied a 10 percent rate on most American imports and taxes much higher in dozens of other countries.
Tariffs, ready to interrupt the global commercial order, highlight a marked change of only a few months ago when the promise of business policies for business under the Trump administration promoted US actions to register maximums.
Investors sold positions to reflect the new economic reality, with concerns about how other countries would react to Trump’s rose garden proclamations.
China promised reprisals, like the European Union, which faces a duty of 20 percent. South Korea, Mexico, India and several other commercial partners said they would retain for now while looking for concessions before tariffs tariffs enter into force on April 9.
The next few days are expected to be volatile, as events take place and the full effect of Trump’s economic actions begin to feed on the economy in general. The CBOE Volatility Index, known as the Wall Street fear caliber, played a maximum of three weeks.
“There are still many more questions than answers here,” said Steven Desonctis, a small and medium capitalization of Jefferies Financial Group.
According to preliminary data, the S&P 500 lost 275.05 points, or 4.85 percent, to end in 5,395.92 points, while the Nasdaq compound fell 1,053.60 points, or 5.99 percent, to 16,547.45. The Dow Jones industrial average fell 1,682.61 points, or 3.98 percent, to 40,542.71.
High flight technology suffered great decreases after pushing Wall Street to register maximums in recent years.
Apple sank, staggering an aggregate tariff of 54 percent on China, the basis for much of the manufacture of the iPhone manufacturer. Nvidia collapsed, just like Amazon.com.
American actions have lost ground since Trump assumed the position in January, with the S&P 500 and the Nasdaq falling 10 percent from the maximum records last month, marking a correction as investors have a price of the economic damage of the tariffs.
Merchants are increasing expectations for the Federal Reserve to reduce interest rates four times this year, starting with a quarter of a point in June.
“The Fed has considerable fire power to help the market,” said George Borge, head of investments of the Allspring Global Investments Allspring team.
“The market now has a price in more rates cuts, and perhaps before,” adding a decrease in June now seemed guaranteed, with the possibility of a cut in May also.
This increases the importance of Friday’s payroll data and the speech of the president of Fed Jerome Powell the same day, which could offer crucial information about the health of the economy of the United States and the future path of interest rates.
The retailers were affected, with Nike and Ralph Lauren falling on a series of new tariffs in the main production centers, including Vietnam, Indonesia and China.
Trump has outlined rates plans in an event called ‘Liberation Day’. Fountain: AAP / Kent Nishimura / Pool / EPA
The big banks such as Citigroup and Bank of America, which are sensitive to economic risks, fell, as did JPMorgan Chase & Co.
The Small Cap Russell 2000 index of the United States fell, underlining concerns about the health of the national economy.
“Small capitalization companies tend to be suppliers from large capitalization companies, so as things go wrong for names of great capitalization due to rates, they will exert a lot of pressure on their small capitalization suppliers,” Jefferies’ Decanctis said.
Exxon Mobil and Chevron fell, since crude prices fell 6.8 percent in rates and OPEC+ accelerating exit increases.
Consumer Staples was one of the few bright points. The sector is traditionally considered a defensive play, but was also promoted on Thursday by Lamb Weston, which won after informing the profits.
