US Stocks Plummet as Trump Orders Tariffs on Major Trading Partners
Stocks in the United States fell to their lowest levels since President Donald Trump’s inauguration two weeks ago after he announced tariffs on Canada, Mexico, and China. This decision also caused global financial markets to slump as world leaders responded to his threats of expanding tariffs to the European Union.
The benchmark S&P 500 dropped 1.7 percent at the opening bell, following significant losses in Asian and European markets. Trump defended his tariffs, saying they may cause short-term pain but will benefit the US in the long run. He later announced a one-month pause on new tariffs for Mexico after Mexico agreed to reinforce its border with 10,000 National Guard officers.
In response to Trump’s threats, EU leaders expressed willingness to negotiate but emphasized their readiness to fight back against tariffs if necessary. Trump hinted that Britain may be spared tariffs. The US had a significant trade deficit with the EU in goods but a surplus in services.
Financial markets reacted negatively to the news, with shares falling in Tokyo, Australia, and Europe. The fear of a trade war slowing global growth and driving up prices for Americans was a primary concern for economists.
Trump’s tariffs cover nearly half of all US imports and could potentially cause recessions in Canada and Mexico. Automakers and European companies could also be greatly impacted by the tariffs.
With concerns about inflation, slower growth, and high unemployment due to the tariffs, analysts are closely monitoring the situation. Trump’s decision to link the tariffs to a national emergency over fentanyl and illegal immigration has raised further questions about the long-term effects of these policies.
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